- Press Releases
In six months, customer funds increase by 2.4%, loans are up by 2.7% and non-performing loans are down to 3.38%
Net operating income increases by 23.2% to 1,975 million euros, due to a strong increase in income (+12.1%) and effective cost management (+2%).
Business volumes are up 2.6% since the beginning of the year, thanks to sustained growth in the customer loan portfolio, which has increased by 4,848 million to 181,271 million euros (+2.7%), with 567,993 new operations.
Customer funds grew during the first six months of the year by 5,817 million euros, reaching a total of 243,517 million (+2,4%), due to an increased market share in investment funds (7.6%), pension plans (15.1%), term deposits (9.4%) and demand accounts (11.4%).
Business loans have continued to grow at a healthy rate, showing an increase of 4.2% across the network and particularly through the Group’s specialist business centres, where business has grown by 31.1% in the last 12 months. There has also been notable growth in factoring and confirming operations, up by 64% and 37% respectively, with a rise in market share to 11.7%.
The preference shares issue worth 1,898 million euros has consolidated financial strength and solvency levels, giving the Group a leading position in its sector: Core Capital is at 8.8%, Tier-1 is at 11.0% (+0.9) with a Capital Ratio of 12.6% (+1,6) and the Group has been give a long-term AA rating by the three ratings agencies.
The Group’s liquidity remains the highest in the Spanish financial system at 22,475 million euros (8.4% of assets), allowing it to act as a permanent lender on the interbank market.
The non-performing loan ratio fell to 3.38%, maintaining the Group’s differential within the sector (5.20% average for savings banks in May). Allowance coverage stands at 60% (127% if mortgage guarantees are taken into account).
In line with the Group’s strategy of extreme prudence, allowance coverage totals 1.060 million euros, of which 314 million represent voluntary coverage. Only 56 million euros of the general allowance have been released, leaving a total general allowance of 2,115 million euros.
Attributed income for the Group stands at 975 million euros. Extraordinary net capital gains resulting from the sale of 1% of Telefónica amount to 249 million euros. Additional allowance coverage has been set aside in this same amount voluntarily and in advance for the investment portfolio.
The solid growth in banking business has led to an increase of 9.7% in net interest income, to 2,019 million euros.
The Group’s cost containment and rationalisation policy, combined with improved levels of productivity, meant that operating costs rose by just 2%, while the efficiency ratio continued to improve to 42.9% (-2.8).
As part of its international expansion plan, 2009 has seen "la Caixa" open the first operational branch of a Spanish bank in Casablanca (Morocco), and it has received authorisation to open its agency office in Shanghai (China).
In addition, "la Caixa" and Criteria have signed strategic investment and collaboration agreements with The Bank of East Asia (in which it holds a 9.85% stake) and Erste Bank (in which it holds a 5.09% stake).
The "la Caixa" Group obtained an attributed income of 975 million in the first six months of 2009, thanks to high levels of commercial activity, thus consolidating its financial strength with improved solvency and a high level of liquidity.
Total income (gross margin) rose to 3,748 million, up by 12.1%, boosted by the more traditional banking business segments (net interest income, fees and the result of financial operations with customers) and by increased income from investments (dividends and income accounted for by the equity method).
Thanks to robust growth in banking business and the appropriate management of operational margins and interest rates, net interest income has risen 9.7% to 2,109 million.
Net fees increased by 5.5% to 650 million with careful management of the services offered to customers.
The strict management of cost containment and rationalisation procedures has kept the rise in operating costs down to just 2%.
A strong increase in total income (+12.1%) and careful cost containment (+2%) has led to continuing improvements in efficiency, giving an efficiency ratio of 42.9% (-2.8), with net operating income at 1,975 million, a robust rise of 23.2%.
The "la Caixa" Group’s non-performing loans ratio has fallen to 3.38%, thanks to the high quality of its loans portfolio and its strict management of both risk and allowance coverage, meaning that this figure remained significantly below the 5.20% average for the savings banks sector in May. The allowance coverage ratio is 60% (127% if mortgage guarantees are taken into account). The general allowance totals 2,115 million euros after the release of 56 million.
The significant income generated by the Group’s recurring activities, 1,975 million during the first six months of 2009, has allowed for a higher level of allowance coverage at 746 million (+175.5%), with net attributed income reaching 975 million and a high level of profitability (ROE of 13.6%). This result represents a fall of 8% on the previous year.
The extraordinary net capital gains obtained from the sale of 1% of Telefónica totalled 249 million euros. Furthermore, additional allowance coverage has been made voluntarily and in advance in the gross amount of 314 million (210 million net), plus allowance coverage on the investment portfolio of 70 million gross (39 million net).
Consolidation of financial strength: further reinforcement of high levels of solvency with Core Capital at 8.8% and excellent liquidity of 22,475 million
The "la Caixa" Group maintains its leading position in the sector, with a Core Capital figure (high-quality shareholder equity) of 8.8%, evidence of the Group’s excellent levels of both capital and solvency. Tier 1 stands at 11.0% while the Group has a BIS II Capital Ratio of 12.6%.
In 2009, "la Caixa" has made a new subordinated debt issue in the amount of 2,500 million euros and a preference share issue in the amount of 1,898 million, in line with the provisions set out in its 2007-2010 Strategic Plan, with a view to strengthening its solvency and financial robustness still further and consolidating its leading market position.
The shareholder equity that can be attributed to the Group amounts to a total of 19,576 million, with a surplus over the minimum regulatory requirement of 7,176 million.
Group liquidity amounts to 22,475 million, 8.4% of total assets, practically all of it immediately accessible. Dependence on the wholesale markets is also extremely low, with institutional borrowings to the value of just 1,000 million maturing before the end of 2009.
High levels of activity in all segments, with increases in banking business and market share
"la Caixa" maintains its aim to lead the Spanish banking sector by using a specialised business model to attend to its 10.7 million customers.
The Group’s great commercial strength, with 27,775 employees, 5,365 branches, 7,965 ATMs and a leading position in on-line banking and cards in circulation, mean that the Group now has 10.7 million customers and is showing robust, balanced and high quality growth in its banking and commercial business.
Total banking business during the first six months of the year totalled 424,788 million, thanks to sustained growth in both loans and deposits. The customer loan portfolio increased in value by 4,848 million (+2.7%), reaching a total of 181,271 million, with 567,993 new operations. Total customer funds totalling 243,517 million, up by 2.4% since the beginning of the year, with a growth of 5.817 million.
"la Caixa" has strengthened its leading position in terms of salaries managed from its accounts, continuing to increase its share to 14.8%, helped by the Nómina multiEstrella campaign which has resulted in a further 45,000 salaries being paid directly into "la Caixa" accounts since March. InverCaixa, an investment fund manager, has also notably increased its share, rising from 6.9% in December 2008 to 7.6% in June 2009, with assets of 12,108 million euros.
As regards loans, "la Caixa" is the entity that holds the highest share of the mortgage market with 10.8% at the end of June, mainly invested in the financing of first and primary residences. "la Caixa" also engages actively in the different ICO (Official Credit Institute) corporate financing lines.
Consolidation of the proposal to bring added value to specialised segments
"la Caixa", whose core business is retail banking, is successfully continuing to grow its private and business banking lines with the aim of achieving a leading market position in these segments. "la Caixa" is also implementing a specialised model for both personal and business banking.
In the business banking segment as a whole, "la Caixa" has increased its loans portfolio by 4.2% to 69,653 million euros. Business loans managed via the “la Caixa” Group’s new specialist centres increased by 31.1%. This is an excellent indication of the consolidation of the Group’s proposal to bring added value to business banking during its introductory year. According to data from the consultant FRS-Inmark, "la Caixa" now has a market share of 40% among SMEs in Madrid and Catalonia.
"la Caixa" has also renewed its agreement with CEOE and CEPYME to provide businesses with 6,000 million euros in loans. In 2008, "la Caixa" was the first Spanish financing institution to establish an agreement with these business organisations.
Turning to products and services, "la Caixa" has seen strong growth in its factoring and confirming business, obtaining a market share of 11.7%: factoring operations are up by 64% to 2,131 million euros, confirming operations have grown by 37% to 2,960 million, while documentary credits are up by 29.4%.
The consolidation of the "la Caixa" Private Banking division, which was further strengthened last year with the acquisition of Morgan Stanley’s business in Spain, has led to an increase in managed funds and securities of 17% over the past 12 months, to a total value of 38,504 million. This increase in funds has resulted from the high levels of commercial activity generated by around 300 private banking managers, with support from the Group’s 28 specialist centres and its entire branch network.
"la Caixa" has continued to implement a specialist model throughout its branch network for both personal customers and business banking (SMEs, the self-employed and traders). During the first six months of the year, "la Caixa" has completed the organisation of its personal banking business with the introduction of 883 managers at 15% of its branches, aimed at offering services to a potential 500,000 customers.
Another of the Group’s important initiatives is the consolidation of MicroBank, the social banking institution created by "la Caixa" in 2007, which has already financed more than 41,000 projects to a value of 292 million euros since its introduction. This makes it the financial institution that devotes the greatest resources to the promotion of projects through the use of micro-credits.
Boost for the 2007-2010 Strategic Plan
As part of its international expansion plan, "la Caixa" has just opened the first branch to be operated by a Spanish banking institution in Casablanca (Morocco), and it has also obtained authorisation to open its representative office in Shanghai (China), to add to those already in operation in London (United Kingdom), Paris (France), Brussels (Belgium), Milan (Italy), Stuttgart and Frankfurt (Germany), Porto and Lisbon (Portugal), Istanbul (Turkey) and Beijing (China). “la Caixa” also plans to open new representative offices in Delhi (India), Algiers (Algeria) and Dubai (United Arab Emirates).
As regards investments in financial institutions, Criteria CaixaCorp, a subsidiary of "la Caixa" has a 20% holding in GFInbursa, 30.1% in Banco BPI, 9.85% in The Bank of East Asia, 5.09% in Erste Bank and 20.9% in Boursorama. "la Caixa" and Criteria have also signed strategic investment and collaboration agreements with The Bank of East Asia and Erste Bank.
The market value of the "la Caixa" Group’s listed investments totalled 16,679 million, with unrealised capital gains of 1,315 million (at close of business on 30 June).
"la Caixa" Welfare Projects
Aware of the particular difficulties created by the current economic situation, "la Caixa" will be strengthening its commitment to society during 2009 through its programme of social, cultural, educational, research, environmental and scientific activities. "la Caixa" has approved the allocation of 500 million euros to its Welfare Projects, of which 62% will be earmarked for the development of its social programmes, 16% for cultural projects, 16% for the environment and science and 6% for education
As part of its social projects agenda, the "la Caixa" Foundation is further strengthening its programmes to combat child poverty in Spain, a campaign to which it has already devoted 85 million euros as part of an initiative that benefits 100,000 children every school year.
The development of job opportunities for disadvantaged groups is another of the "la Caixa" Foundation’s priorities. A total of 7,932 companies and 220 social institutions now form part of Programa Incorpora of the "la Caixa" Welfare Projects. More than 18,200 disadvantaged people have already found work through this initiative.
In addition, the first six months of the year saw the introduction of 30 teams in the "la Caixa" Foundation’s new programme to provide comprehensive care for the seriously ill. The programme aims to help 12,000 patients in various hospitals around Spain during 2009.
During the first six months of 2009, the "la Caixa" Accessible Housing programme, aimed at facilitating housing for young people between the ages of 18 and 35 and senior citizens over the age of 65, was extended to include large family units, with the development of rented accommodation. The Programme aims to hand over 1,000 flats by the end of 2012.
As part of its programme to combat the use of drugs, the "la Caixa" Welfare Projects and the Fundación de Ayuda contra la Drogadicción (Foundation to Help Combat Drug Addiction) organised a conference entitled Hablemos de Drogas (Let’s Talk About Drugs), which was opened by Her Majesty the Queen of Spain and attended by 600 delegates and experts.
Particularly notable in the educational section of the "la Caixa" Welfare Projects is the Student Grant Programme, under which a total of 335 grants to a value of 9.6 million euros have been awarded for post-graduate studies at universities both abroad and in Spain. The award ceremony was hosted by the King and Queen of Spain.
Among other activities, an important part of the cultural programme involves the conservation of heritage items, such as the recovery of Romanesque Art, to which 18.2 million euros will be allocated between now and 2013.
The government of Aragón and "la Caixa" have signed an agreement to create Caixaforum- Zaragoza, while a separate agreement has been reached with the Government of Andalusia, which has assigned the site of the Royal Shipyards in Seville for restoration as the venue for CaixaForum-Sevilla.
NOTE.- In so far as it relates to income from investments, this financial information from the "la Caixa" Group for the first six months of 2009 has been prepared mainly on the basis of estimates, and cannot under any circumstances be used to make forecasts regarding the income of Criteria CaixaCorp, a subsidiary of the "la Caixa" Group, for the same period.