BPER Banca posts mixed third quarter results

BPER Banca on Thursday reported third quarter results that exceeded consensus on pre-provision profit by 3%, driven by stronger other operating income, though core profit and loss items fell slightly short of expectations.

Net interest income came in 1% above consensus forecasts, with loans remaining flat quarter-over-quarter and deposits rising 1%. Commission income missed consensus by 1% and declined 3% from the previous quarter during what the bank characterized as a seasonally weak period.

Operating expenses came in 1% higher than consensus estimates. The bank recorded €17 million in restructuring costs during the quarter, with approximately €30 million in restructuring costs related to the BPSO acquisition still remaining out of a total €400 million.

The cost of risk stood at 27 basis points in the third quarter, with quarterly provisions coming in 16% below expectations. Non-performing exposure ratios remained stable from the prior quarter. Stage 2 loans increased 4% during the period. Non-performing exposure coverage decreased to 53% from 54% quarter-over-quarter, though total provisions grew by €80 million to €310 million.

The Common Equity Tier 1 ratio reached 15.1%, up 10 basis points from the previous quarter and 10 basis points ahead of consensus expectations of 15%. The bank absorbed 25 basis points of negative impacts from regulation and models during the quarter.

BPER Banca will distribute an interim dividend of €694 million, or €0.33 per share, in line with previous guidance.

The bank updated its 2026 targets, lowering its cost of risk outlook to below 35 basis points from approximately 40 basis points and raising its CET1 ratio target to above 14.5% from approximately 14.5%.