Caixabank beats expectations in first nine months of 2019

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Bankinter | Caixabank results for the first nine months of 2019 surprised positively. These are the principal figures for the period compared with the consensus (Reuters).

Interest margin 3.720 Bn€ (+1.3% vs +1.9% in first half 2019 vs 3.712 Bn€ estimated); Gross margin: 6.610 Bn€ (-4.2% vs -4.5% in first six months 2019 vs 6.565 Bn€ estimated); Operating profit: 2.035 Bn€ (-40.6% vs -54.8% in first half 2019 vs 1.987 Bn€ estimated; NAP: 1.266 Bn€ (-28.4% vs -52.1% in first six months 2019 vs 1.186 Bn€ estimated).

In the opinion of our analysts, the results have improved at operational level and beaten expectations, although the lower part of the profit and loss account is resisting because of the cost of restructuring the commercial network. The profit and loss account shows: (i) the resilience of the interest margin and the commercial dynamism in key segments (companies and consumption) and (ii) the stability of risk costs, currently at 14bp (with changes respect to 2Q19). Risk indicators are evolving positively. NPLs fall to 4.1% (vs 4.2% in 3Q19) and coverage remains stable at 54%. The capital ratio CET1 FL has improved to 11.7% (vs11.6% in 2Q19) thanks to the organic generation of capital. The ROTE has fallen to 6.8% (vs 9.5% in first nine months of 2019) although the ordinary ROTE (excluding restructuring costs) reaches 10.1%.

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