Latest news with #loanportfolio
Zawya
4 days ago
- Business
- Zawya
Al-Sager: Our strong operational performance continued, with robust profits
Vice Chairman and Group CEO Speaks on the Sidelines of the 1H2025 Analysts' Conference Call Our loan portfolio recorded Strong growth, both in Kuwait and through our international operations Our regional and global footprint continues to play a key role in mitigating risks and sustaining earnings stability Confident in our ability to navigate challenges, we draw strength from our resilience and strategic investments in technology The outlook for project activity in Kuwait remains promising, with positive momentum expected to continue Effective capital planning remains a top priority to ensure we are aligned with our long-term growth objectives Focusing on year-end dividend distribution gives us the flexibility to capitalize on growth opportunities as they arise Our commitment to sustainability remains steadfast as we make meaningful progress on our sustainable finance roadmap Ronghe: The Group maintains strong operating momentum, fueled by robust growth in business volumes Sustained strength in our loan portfolio reflects high asset quality and prudent diversification strategy Mr. Isam Al-Sager, Vice Chairman and Group Chief Executive Officer of National Bank of Kuwait (NBK), stated that the Bank reported a net profit of KD 315.3 million for the first half of 2025, marking a 7.8% increase from KD 292.4 million in the corresponding period of 2024. Speaking on the sidelines of the analysts' conference call for the first-half 2025 results, Al-Sager highlighted that profit before tax surged by 17.0% year-on-year, reaching KD 401.5 million in the first six months of the year. He explained that the new tax regime weighed on profitability, with the effective tax rate rising to 16.0% in the first half of 2025, up from 9.2% in the first half of 2024. Al-Sager added that the Bank's pre-tax profit was further supported by the release of provisions for credit and impairment losses amounting to KD 10 million, compared to a charge of KD 43 million in the six-month period ended June 30, 2024. 'Our returns remained robust, with Return on Average Assets reaching (ROAA) 1.52% and Return on Average Equity (ROAE) standing at 15.1% for the period', Al-Sager said. He explained that the Bank is confident in its ability to adapt and maintain its leadership in the local market, highlighting its readiness to navigate economic headwinds and emerge even stronger, supported by its resilience, continued investment in technology and innovation, and steadfast commitment to meeting the evolving needs of its customers. Dividend Distribution Policy Regarding the dividend distribution policy, Al-Sager stated that NBK's approach remains unchanged, maintaining a sustainable framework that strikes a balance between delivering attractive shareholder returns and prudently managing capital ratios. He added that the Bank continues to prioritize effective capital planning to ensure capital levels align with its future growth ambitions, an approach it has consistently upheld and will continue to follow going forward. Al-Sager stressed that the Bank remains committed to its approved dividend policy, noting that in light of the strong growth in its loan portfolio both locally and internationally, the Bank has opted to retain interim profits until year-end, with a focus on year-end final dividend distribution. This approach provides greater flexibility to capitalize on growth opportunities as they emerge throughout the year, in alignment with the Bank's strategic priorities. He pointed out that NBK's regional and international presence plays a vital role in mitigating risks, sustaining stable returns, and enhancing operational efficiency. Furthermore, he added that the Bank remains focused on leveraging cross-selling opportunities across its diverse geographical footprint. At the same time, its wealth management arm will continue to capitalize on deep expertise to deliver a comprehensive suite of portfolio management, advisory services, and investment solutions. Meanwhile, the Bank's Islamic banking services will further strengthen their local footprint while diversifying sources of profitability. Projects Market Momentum Al-Sager emphasized that following a strong year of project market activity in 2024, particularly in the second half of the year, the pace of activity moderated slightly during the first half of 2025. He noted that this moderation largely reflects a normalization from the elevated levels seen last year. Nonetheless, the outlook remains encouraging, supported by a pipeline of ongoing projects valued at KD 10 billion, signaling the government's continued commitment to advancing its development and reform agenda. Al-Sager affirmed the Bank's ongoing commitment to sustainability and the advancement of its sustainable finance agenda, highlighting the recent publication of its first Green Bond Allocation and Impact Report, as well as its inaugural TCFD Report. These disclosures underscore NBK's efforts to enhance transparency and accountability in its ESG and sustainable finance strategy. They also reflect the Bank's significant progress in integrating climate considerations across its operations, with a strong emphasis on portfolio diversification and climate risk management. Meanwhile, Mr. Sujit Ronghe, Group Chief Financial Officer at NBK, stated that the Group continues to demonstrate strong operational momentum, driven by robust growth in business volumes, most notably across the loan and investment portfolios. He added that the Group continues to benefit from the strength of its loan portfolio, which demonstrates high asset quality and a well-considered diversification of growth sources. Ronghe explained that key business segments made strong contributions to net profit in the first half of 2025, highlighting their effectiveness as core pillars of the Group's diversification strategy and their role in reinforcing profit resilience. He stressed that NBK Group continues to leverage its unique competitive advantages among Kuwaiti banks, particularly its broad geographic footprint and its ability to operate across both conventional and Islamic banking. Amid growing concerns over the impact of the ongoing tariff war and its implications for the global business landscape, Ronghe explained that NBK remains well-positioned to navigate this volatile environment, a testament to the strength and resilience of its diversified business model. Regarding the catalysts for loan growth during the first half of 2025, Ronghe stated that corporate credit was the primary driver, emphasizing that demand was not concentrated in any single geographic area. Instead, it was well distributed across NBK's network, including the GCC region, international markets, and Boubyan Bank.
Yahoo
21-07-2025
- Business
- Yahoo
AU Small Finance Bank Ltd (NSE:AUBANK) Q1 2026 Earnings Call Highlights: Strong Deposit Growth ...
Release Date: July 19, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points AU Small Finance Bank Ltd (NSE:AUBANK) reported a strong growth in its deposit book, which increased by 31% year-on-year, significantly outpacing the system growth rate. The bank's loan portfolio grew by 18% year-on-year, driven by core secured segments such as retail secured assets and commercial banking assets. The wheels segment, a key product within retail secured assets, showed robust growth with a 26% year-on-year increase in its gross loan portfolio. The bank maintained a healthy liquidity position with an average Liquidity Coverage Ratio (LCR) of 123%, up 7% from the previous quarter. AU Small Finance Bank Ltd (NSE:AUBANK) achieved a profit after tax of INR 581 crores, marking a 16% increase from the previous year. Negative Points The bank experienced elevated credit costs, particularly in its unsecured segments, leading to a revision in its full-year credit cost expectations. There was a decline in net interest margin by 38 basis points, attributed to a reduction in asset yield and investment yield. The unsecured microfinance book faced challenges with asset quality and book de-growth, impacting the bank's overall performance. The bank's mortgage portfolio in the southern region showed signs of stress, with higher credit costs due to deterioration in asset quality. The credit card and personal loans business experienced elevated credit costs, with the bank acknowledging a peak in absolute terms this quarter. Q & A Highlights Warning! GuruFocus has detected 6 Warning Signs with NSE:AUBANK. Q: How does AU Small Finance Bank expect its Return on Assets (ROA) to settle in FY26 and FY27, considering the pressure on net interest margin and credit costs? A: The bank has not provided specific guidance for ROA in FY26 but reiterates its target of achieving a 1.8% ROA for FY27. The bank expects FY26 to be stronger than FY25, which had an ROA of around 1.4%, despite the current challenges. (Respondent: Unidentified_3) Q: Can you elaborate on the stress observed in the used commercial vehicle (CV) segment? Is it geographically specific or broad-based? A: The stress in the used CV segment is not geographically specific but is related to the segment itself, which constitutes about 6% of the total yield assets. The pressure began last year due to delayed CapEx and heavy rains, but corrective measures have been taken, and the book is performing well post-adjustments. (Respondent: Unidentified_5) Q: What has structurally changed in the secured retail credit cost, which has been running higher than historical levels? A: The bank acknowledges that businesses go through cycles, and the current economic pressures have led to elevated credit costs. However, the bank remains one of the strongest franchises in terms of collection and asset quality. The expectation is for credit costs to stabilize in the range of 75-80 basis points. (Respondent: Unidentified_6) Q: What led to the stress in the microfinance (MFI) and South-based mortgage portfolios, and how is the bank addressing it? A: The stress in the MFI segment was due to a drop in collection efficiency, which is now improving. The South-based mortgage book faced challenges due to team transitions and infrastructure issues, which are being addressed. The bank expects normalization in a couple of quarters. (Respondent: Unidentified_5) Q: What is the outlook for loan growth in FY26, given the stress in some segments? A: The bank aims to grow 2 to 2.5 times the nominal GDP, with growth driven by vehicle financing, commercial banking, and gold loans. The bank expects stabilization and growth in the microfinance segment from Q2 onwards. (Respondent: Unidentified_2) For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
27-06-2025
- Business
- Yahoo
Atlantic Union sells roughly $2B in CRE loans to Blackstone
This story was originally published on Banking Dive. To receive daily news and insights, subscribe to our free daily Banking Dive newsletter. Atlantic Union Bank has closed the sale of about $2 billion in performing commercial real estate loans to Blackstone Real Estate Debt Strategies, the company announced Thursday. The CRE loan sale, primarily covering locations in the Washington, D.C., metro area, was announced as part of Virginia-based Atlantic Union's merger with Sandy Spring Bancorp, which closed in April. The lender retained customer-facing servicing responsibilities and sold the loan portfolio at a percentage of par value in the low-90s. 'After closing our acquisition of Sandy Spring, we have been focused on integration and execution,' Atlantic Union CEO John Asbury said in a statement. 'The loan sale transaction reduces our CRE concentration and frees up capacity for potential future growth.' Blackstone, an alternative asset manager with nearly $76 billion of investor capital under management, has snapped up $20 billion of CRE loan portfolios over the past two years. The acquisition includes a roughly 20% stake in the $17 billion Signature Bank CRE debt portfolio. 'This transaction demonstrates the breadth of our market-leading platform and deep expertise providing solutions to financial institutions for their commercial real estate portfolios,' Tim Johnson, global head of Blackstone Real Estate Debt Strategies, said in a statement Thursday. Several banks have sought, in recent years, to limit their exposure to commercial real estate. Souring CRE loans played a prominent role in a surprise $252 million loss at New York Community Bank that nearly spurred its collapse in January 2024. The bank, months later, announced it would sell roughly $5 billion in mortgage warehouse loans to JPMorgan Chase in an effort to boost liquidity levels. A strong concentration of CRE loans also contributed to the termination of an expected merger between HomeStreet and FirstSun. HomeStreet sold $990 million in multifamily CRE loans to Bank of America in December, then inked a $300 million deal to be purchased by California-based Mechanics Bank. Bank of America has been a frequent acquirer of cast-off CRE loans. The bank bought roughly 2,000 commercial multifamily real estate loans from Seattle-based WaFd in May 2024 for about $2.9 billion. Analysts at Raymond James and Piper Sandler saw the Atlantic Union-Blackstone deal as 'positive.' 'The transaction frees up liquidity to support loan growth, purchase securities and reduce wholesale funding and should be supportive of the bank's [net interest margin] outlook,' Raymond James analysts wrote. They expect 'a significant improvement in financial performance over the next 12 months as the loan pipeline continues to build, core NIM appears likely to expand, and asset quality remains strong.' Recommended Reading Citi acquires Deutsche Bank's Mexico license
Bloomberg
18-06-2025
- Business
- Bloomberg
BBVA in Talks With Cerberus, One William Street on Loan Sales
BBVA SA is in advanced talks to sell two loan portfolios totaling around €650 million ($754 million) to funds including Cerberus Capital Management 's Spanish unit and One William Street Capital Fund, according to people familiar with the matter. The sales add to the so-called significant risk transfers recently carried out by BBVA in a effort to trim its balance sheet and generate capital as it bids for Spanish rival Banco Sabadell SA. That deal is close to a decision point and could imply a hit to capital for BBVA, Spain's second-biggest bank.
Yahoo
17-06-2025
- Business
- Yahoo
LHV Group results for May 2025
May for LHV was characterised by the rapid growth of the loan portfolio. Profitability was impacted by the ongoing decline in interest rates and the partial reversal of previous impairments. LHV Group's consolidated loan portfolio grew by EUR 104 million in May. At the same time, the total volume of deposits decreased by EUR 34 million. The volume of funds managed by LHV decreased by EUR 11 million over the month. In May, 6.7 million payments related to financial intermediaries were made. In May, AS LHV Group earned EUR 10.3 million in consolidated net profit. Among the subsidiaries, AS LHV Pank earned a net profit of EUR 10.5 million, LHV Bank Ltd earned a net profit of EUR 28 thousand, AS LHV Kindlustus earned a net profit of EUR 339 thousand, and AS LHV Varahaldus earned a net profit of EUR 297 thousand. The return on equity attributable to the shareholders was 17.3% in May. The number of LHV Pank customers grew by 2,800 in May, exceeding the 470,000 mark. Loan growth was strong at EUR 83 million, of which EUR 51 million came from corporate loans and EUR 32 million from private loans. The overall quality of the loan porftolio remains good and a solution was found for one of the two largest non-performing loans, which led to a reduction in previously recognised provisions. The strong month was also reflected in deposits, as corporate banking deposits decreased by less than expected against the backdrop of an increase of EUR 88 million in retail banking deposits. The decline in interest rates is reducing the bank's net interest income, as deposit interest rates are falling more slowly than loan interest rates. LHV Bank, which operates in the United Kingdom, launched the initial version of its retail customer offer in May, that allows customers to use the bank app, open an account, make payments, order a bank card, and securely deposit money. The presentation of the offer and the marketing campaign were started, the costs of which also affected the company's monthly profit. Work will continue on the following products to further develop the offer. The Bank's loan portfolio grew by EUR 21 million in May. The stable revenue growth of LHV Kindlustus also continued in May. New insurance contracts were concluded for an amount of EUR 3.15 million. As at the end of May, there are 274,000 valid insurance contracts. Performance improved due to a successful motor own damage insurance campaign. Compensation for loss events amounted to EUR 2.2 million and 12,500 new claims were registered in May. The profitability of Kindlustus has been improved by a very good loss ratio. Since May was a strong month in the financial markets, the pension funds of LHV continued to grow value for their customers. The larger funds managed by the LHV Varahaldus, L and XL, increased by 1.2% and 2.3%, respectively, over the month. LHV Pensionifond Indeks increased by 5.6% over the month. The net profit of LHV Varahaldus exceeds the financial plan, while the volume of funds and the number of customers are slightly below the planned level. In May, LHV Varahaldus announced a plan to change the names of pension funds to make them clearer for customers and to merge the green pension funds with other funds. Since LHV Group issued AT1 bonds worth EUR 50 million in April, EUR 15 million worth of AT1 bonds were called back in May. As a result of the share option program, the share capital of LHV Group was increased by EUR 366,721.30. Share acquisition transactions were also initiated in accordance with the resolution of the shareholders' general meeting held in March. The financial plan stands. The reports of AS LHV Group are available on the website at: LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group's key subsidiaries are LHV Pank, LHV Varahaldus, LHV Kindlustus, and LHV Bank Limited. The Group employs over 1,150 people. As at the end of May, LHV's banking services are being used by 471,000 customers, the pension funds managed by LHV have 111,000 active customers, and LHV Kindlustus protects a total of 176,000 customers. LHV Bank offers retail banking services to private customers in the United Kingdom, loans to small and medium-sized enterprises, and banking services to international fintech RumCommunications ManagerPhone: +372 502 0786Email: Attachment LHV Group 2025-05-ENSign in to access your portfolio
