The CaixaBank Group posted an attributable net profit of €3.15 billion in 2022, up 29.7% on the previous year, on a like-for-like basis. This growth has come on the back of commercial strength and synergies arising from the integration.
Adjusting for the extraordinary impacts of the Bankia merger, the reported net profit was down 39.8%, given that the figure at year-end 2021 was €5.23 billion, due to the positive contribution for accounting purposes of €4.3 billion in badwill and other extraordinary items arising from the merger.
During 2022, year of the merger process completion, CaixaBank has been able to maintain a strong commercial pace despite the climate of uncertainty caused by the Ukraine invasion, and to meet its financial and business objectives. Moreover, the return on tangible equity (ROTE) climbed to 9.8% and the cost-to-income ratio excluding extraordinary expenses improved to 51.9%.
José Ignacio Goirigolzarri, Chairman of CaixaBank, remarked that “2022 was a very significant year for CaixaBank. We have succesfully concluded the biggest integration in the history of the Spanish banking sector; we have presented our first strategic plan after the merger, a plan that sets the bank’s path for the period 2022-2024 in order to reach the final goal of our integration: to lead the transformation of the financial sector in our country; and we have launched our new brand purpose: ‘Standing by people for everything that matters’”.
“We look to the future with optimism and with great ambition. Our objective is to keep supporting society, families and companies, because that is, with no doubt, the best contribution that we, as CaixaBank, can make to attend and promote the transformation of our economy”, Goirigolzarri stressed.
The Chairman of CaixaBank has highlighted that the bank closed the year with greater financial strength and a strong capital position, which allow it to pay shareholders a dividend of €1.7 billion; an amount that, added to the €1.8 billion invested in the share buyback programme, raises the total capital distributed to shareholders to €3.5 billion. “We are in the right path to reach our target to distribute up to €9 billion in the 2022-2024 period”, he remarked.
Gonzalo Gortazar, CEO of CaixaBank, highlighted that at CaixaBank “we have completed a very positive year in terms of improving our commercial activity, as well as our credit quality and our financial strength. We are especially proud of the strong growth in commercial activity, which reflects our capability and willingness to support families and companies, and of the improvement in our financial results, which allows us to substantially increase our shareholder remuneration” and the contribution to the “la Caixa” Foundation Welfare Programme.
“I would like to highlight the efforts undertaken by the whole CaixaBank team, which has been able to successfully complete the Bankia integration while continuing to offer a high-quality service to all our customers and increasing our commercial activity”, Gortazar pointed out.
Income statement (on a like-for-like basis)
Earnings for 2022, which are comparable with the pro-forma results of Bankia and CaixaBank in the previous year, excluding the extraordinary items arising from the merger, revealed strong commercial activity at the Bank. Core revenues were up 5.8% to €12 billion, driven by an increase of 7.7% in net interest margin and of 33.1% in income and expenses under insurance contracts, with fee and commission income in line with the previous year (+0.6%), offseting the decline in revenues from the bancassurance stakes segment (-26.2%).
In particular, banking fees and commissions were up 1.7% in the year, although recurring banking fees and commissions saw a slight decline of 0.3% due to the elimination of deposit custody fees and the unification of loyalty programmes for retail customers following the merger, which increased the number of customers who pay no fees on basic transactions. Meanwhile, wholesale banking fees and commissions were up 20.5%, showcasing the increase in activity that took place during the year.
Dividends came to €163 million in 2022 (-15%) and include the recognition of €69 million and €87 million in dividends paid by Telefónica and BFA, respectively. The equity-accounted attributable earnings totalled €264 million in 2022, down 39.5% year on year, partly due to changes in scope following the sale of Erste Group Bank and the full consolidation of Bankia Vida. Meanwhile, revenue from financial transactions was up 47%.
Gross income increased by 5.5% in the year to reach €11.6 billion, while recurring administrative, depreciation and amortisation expenses were down 5.6% year on year, thanks to the synergies arising from the Bankia integration, enabling growth of 19.8% in pre-impairment income.
In 2022, the Bank completed the process of employee voluntary departures under the Labour Agreement, leading to an 8.1% decline in personnel expenses in the whole of 2022.
The income statement also includes various contributions and fees accrued during the year, including, among others, the contribution of €407 million to the Deposit Guarantee Fund (FGD, in Spanish) in the fourth quarter and the contribution of €159 million to the Single Resolution Fund (FUR, in Spanish) in the second quarter.
Strong commercial activity in an uncertain background
CaixaBank reported strong commercial activity in 2022, despite the uncertain background, across all the channels through which it operates (including not only the most extensive branch network in Spain, but also remote or digital channels, such as inTouch, CaixaBankNow and imagin), and thanks to a wide range of products and services designed to respond to each customer’s needs.
The year saw growth in lending to both individuals and businesses, with performing loans (excluding NPLs) up 3.3% in the year to reach €351.23 billion. In particular, the performing business-loan portfolio was up 7.6% in the year, while consumer lending and mortgage portfolios grew by 4.1% and 0.7%, respectively.
In 2022, mortgage lending in Spain more than doubled (+108%) to €14.3 billion, thanks to MyHome, CaixaBank’s ecosystem of solutions for every housing need. In mortgage lending, CaixaBank remains committed to fixed-rate loans, as they provide added certainty for customers as to what they will be paying over the whole life of the loan. For 2022, more than 90% of residential mortgage contracts were originated at fixed rates.
In relation to consumer lending in Spain, new financing amounted to €10.24 billion throughout 2022, up 16% on 2021. In financing to businesses, new loan production came to €41.6 billion, after growing 23% during the year, driven by a model based on specialisation and service to businesses.
In terms of liabilities and equity management, excluding the negative impact of the market on long-term savings products, customer funds were up 1.1%, as CaixaBank managed to raise €6.9 billion in net customer funds inflows during the period. Customer funds amounted to €609.13 billion at year-end, down 1.7% in annual terms when taking into account the impact of market volatility.
Assets under management totalled €144.83 billion. The annual performance (-8.3%) was largely down to the unfavourable performance of the markets, although in the last quarter of the year these assets show a positive performance by growing by 0.5%. The bank, a leader in asset gathering, registered net inflows of €3.73 billion in long-term savings products in 2022, which resulted in an increase of the long-term savings market share by 25 basis points in the year, up to 29.7%.
More specifically, assets under management in mutual funds, portfolios and SICAVs (€101.52 billion) were down 7.8% in the year, but grew 0.7% in the fourth quarter. Pension plans (€43.31 billion) remained stable in the fourth quarter, despite falling 9.6% in the year.
Non-performing loan reduction and coverage ratio improvement
Throughout 2022, CaixaBank worked hard to manage its non-performing loans, which fell to €10.69 billion following the good performance of asset quality indicators and NPL active management supported by portfolio sales. As a result, non-performing loans fell by €2.94 billion in the year and by €952 million in the quarter.
This brought the NPL ratio to 2.7% at the end of 2022, an all-time low and almost one percentage point below the level reported in December 2021 (3.6%), with a reduction in the ratio across all credit segments.
Meanwhile, loan-loss provisions came to €7.87 billion at year-end, the coverage ratio increased to 74%, 11 percentage points more than at the end of 2021 (63%), and the cost of risk (trailing 12 months) remains at 0.25%.
Comfortable liquidity and capital position
CaixaBank managed to end 2022 with high levels of liquidity and solvency, confirming the strength of the Group’s balance sheet. Total liquid assets amounted to €139.01 billion at the end of the year. Moreover, the Group’s Liquidity Coverage Ratio (LCR) was 194% at 31 December 2022, revealing a comfortable liquidity position well clear of the minimum requirement of 100%.
At 31 December 2022, a total of €15.62 billion in TLTRO III financing had been drawn under ECB credit facilities. An outstanding TLTRO III balance of €65.13 billion was repaid in 2022, of which €13.5 billion related to ordinary repayments and €51.64 billion to early repayments.
Turning to capital, the Common Equity Tier 1 (CET1) ratio ended the year at 12.8% (12.5% without IFRS 9 transitional adjustments), following the extraordinary impact of €1.8 billion under the share buyback programme carried out in 2022 (-83 basis points). Notably, the Bank achieved an organic capital generation of 117 basis points during the year.
MREL ratio to RWAs stands at 26%, comfortably meeting the Bank’s requirements for 2024.
Increase in the dividend per share
The CaixaBank Board of Directors has agreed to propose to the General Shareholders Meeting the payment of a dividend totalling €0.2306 per share against 2022 profits, representing an increase of 58% on the €0.1463 in 2021. This remuneration, which will be paid in the second quarter, represents a payout of 55%, in line with the bank’s approved policy to distribute between 50% and 60% of the Bank’s earnings this year.
This dividend reverts directly to society, given that the Bank’s two main shareholders are ”la Caixa” Foundation and the Spanish State, through the FROB. Moreover, the Bank has 617,800 retail shareholders.
The Board of Directors has likewise approved the Dividend Policy for 2023, consisting of a cash distribution of between 50% and 60% of consolidated net profit, to be paid in a single payment in April 2024, subject to final approval by the General Shareholders Meeting.
Financial strength to support customers and society
The robust 2022 results and CaixaBank’s financial strength allow the bank to reinforce its commitment to supporting its customers and society as a whole, as stated in the new brand purpose: “Standing by people for everything that matters”.
CaixaBank fulfils a basic social function and will continue to support society in three main areas: helping clients in difficulty, financial inclusion, and social initiatives.
To achieve the financial inclusion of all citizens, CaixaBank offers the largest branch network in Spain. The Bank is present in over 2,200 municipalities (twice as many as its closest competitor), and it is the only bank with a branch in 470 towns, since it is committed to maintaining a presence in every town in which it is currently present.
In particular, it has 3,818 branches available to retail customers. CaixaBank also has the most extensive ATM network in the country, with 11,608 units, all of which adapted to accept passbooks and user-friendly for senior customers. It also runs 17 mobile branches (the “ofimóvil” branch in a bus) to provide service to 626 municipalities.
As a further expression of its commitment to financial and social inclusion, the Bank has been offering a comission-free Social Account since 2014 (with additional benefits compared to those of the Basic Account) to people with very low income and in a particularly vulnerable situation. CaixaBank also runs MicroBank, the largest microlending bank in Europe, and has implemented significant measures as part of its commitment to senior citizens.
To further strengthen its support for its customers and society as a whole, CaixaBank was the first bank to commit to implementing the new support measures for mortgage borrowers in difficulty approved last November.
Video CaixaBank's Chairman, José Ignacio Goirigolzarri
Video CaixaBank's CEO, Gonzalo Gortázar
Quote from CaixaBank's Chairman, José Ignacio Goirigolzarri
