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Mortgages drive recovery in Bankinter's lending income

Bankinter's Q4 profit falls on one-offs, interest income steadies
Bankinter's Q4 profit falls on one-offs, interest income steadies Copyright Thomson Reuters 2022
Copyright Thomson Reuters 2022
By Reuters
Published on Updated
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By Jesús Aguado

MADRID -A rise in lending thanks to new mortgages drove a recovery in financial margins at Spain's Bankinter's in the fourth quarter, although net profit fell on one-off charges.

Net interest income (NII), earnings on loans minus deposit costs, rose 0.1% year-on-year to 320.2 million euros ($363.8 million), the bank said on Thursday.

That beat the 319 million euros forecast by analysts and was 1.4% higher than the third quarter.

For the whole of 2021, NII grew 2.3%, in line with the bank's guidance for low-single digit growth. Chief financial officer Jacobo Diaz also guided for low-single digit growth this year.

Banks across Europe are under growing pressure from rising bad debts and record low interest rates, which is driving lenders to look for other areas of growth, such as commissions generated in private banking.

Brokers Keefe, Bruyette welcomed the "overall solid quarter from Bankinter, with good growth in loan activity and fees."

In 2021, Bankinter's lending book grew 5.7%, boosted by a 58% rise in new mortgage loans.

Shares in Bankinter fell 0.2%, having risen almost 14% so far this year up to Wednesday's close. Spain's blue-chip index Ibex-35 had gained just 0.7% in the same period.

Bankinter's net profit fell 15% to 82.5 million euros ($93.7 million) in the October-to-December period due to charges related to its contribution to national funds that protects bank deposits and the loss of income following the listing of its insurance business LDA in April. Analysts had expected a quarterly profit of 60 million euros.

However, net profit was still below the 106 million euros recorded in the fourth quarter of 2019, before the outbreak of the COVID-19 pandemic.

In 2021, Bankinter reported net profit of 1.33 billion euros compared to 317 million in 2020, boosted by 896 million euros of capital gains from the listing of LDA.

($1 = 0.8583 euros)

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