The Grupo Unicaja Banco has achieved a net profit of 78 million euros at the end of the complicated financial year 2020 after making an extraordinary endowment of 200 million in order to cover the potential economic impact of the pandemic. The results are thus 54.8% lower than those of 2019, where 172 million were earned. Of course, if this provision had not been made, Unicaja would have earned 218 million, with an increase of 26.6% over the previous year.
“In the uncertain economic context, Unicaja Banco has prioritized the strengthening of its good starting position,” said the Malaga entity.
The bank explained this Tuesday that The main keys to the 2020 results have been the ability to generate results, which allows mitigating the impacts of Covid-19; the growth of business activity; the continued reduction of operating expenses; the decrease in non-productive assets, reinforcing the high levels of coverage, and the high solvency and liquidity ratios, together with the reinforcement of capital ratios, “which confirm the strength of the entity to face the current situation and continue giving response to its customers in the current context of difficulty “.
Unicaja Banco affirms that it has been able to reverse the negative effects derived from the stoppage of activity caused by the declaration of the alarm state. The basic margin, the main indicator of profitability of the typical business, has risen by 0.2% in the year, with “significant growth” in the last two quarters, of 8.9% and 3.7% respectively, after the impact of Covid-19 in the second quarter.
On the other hand, cost containment has reduced operating expenses in relation to 2019 by 35 million euros (-5.7%). This has improved the basic result (interest income plus commissions plus operating expenses) by 18% in relation to the previous year, from 203 to 239 million euros.
“Unicaja Banco has managed, despite adverse economic conditions, to continue reducing its non-productive assets and at the same time increase the high level of coverage and its already outstanding liquidity and solvency positions, enhancing its position of strength in the face of the uncertain economic scenario “, the entity added.
Excluding the extraordinary endowments commented on by the Covid, andhe cost of ordinary risk is at a low level of 14 basis points (bp), as in previous exercises. “This evolution of ordinary credit write-offs is a reflection of the quality of the entity’s assets and the continuous decline in non-productive assets”, Unicaja Banco detailed.
Regarding commercial activity, although it has been affected by the pandemic, the bank affirms that its recovery began in the third quarter. In this sense, non-doubtful credit grows 0.8% in the fourth quarter, leaving the annual variation at -0.2%, with relevant increases in the year in loans to public administrations (+ 18.9%) and companies (+ 5%), and decreases in individuals, despite the growth of new production in this segment in the last two quarters.
On the other hand, customer funds increased 6.5% in the year and 2.6% in the fourth quarter. The capture of customer funds on the balance sheet has also been positive, where there has been a growth of 8.7% year-on-year, highlighting the increase in demand balances and public administrations, of 14.5% and 16.1% , respectively. Off-balance sheet resources and insurance have also increased, growing 2.6% in the last quarter, allowing the balances of the previous year to be exceeded (+ 0.2%), after the negative impact of Covid-19 on balances of this section in the first quarter.
Unicaja Banco has also highlighted the “continued reduction” of non-productive assets (NPAs) by 8% (-198 million euros) in the last twelve months and by 5.6% in the last quarter, in addition to the strengthening of the level of its “high coverage” (improvement by 7.3 points with respect to the previous year, and 0.8 points in the fourth quarter, to stand at 65.2%).
The “comfortable solvency and liquidity position” thus confirms the strength of Unicaja Banco, which has highlighted the increase in the CET-1 ratio to 16.6% and that of total capital, to 18.2%, among the highest of the sector, with one more percentage point in year-on-year terms in both ratios and with an increase in the excess over the SREP requirements to 1,332 million euros. Liquidity levels remain high, with an LTD ratio of 65.2%.
“Excess capital and liquidity in existence place Unicaja Banco in a solid position to face the uncertainties that the evolution of the pandemic continues to pose and allows the entity to continue playing a relevant role in supporting its clients,” the statement reiterated. entity.
In this pandemic scenario, and in support of individuals, companies and the self-employed, and especially the most vulnerable groups, the entity has approved more than 12,500 loan applications with ICO endorsement from freelancers and companies, for a limit of 900 million euros, and processed more than 23,800 requests for moratorium, both legal and sectorial, on mortgage and personal loans, which affect a current volume of credit of approximately 860 million, of which their moratorium remains in force only around 570 million.
The number of digital clients (web and app) at the end of the fourth quarter of 2020 represented 54.4% of the total. Regarding the channels used, of the set of financial transactions and inquiries, the greatest weight in the past year corresponded to digital transactions, both through the web and the mobile application (56% of the total); 22% took place through POS; 16%, in offices, and 6%, in ATMs.
Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.