Bankinter Portugal made a pre-tax profit of 165.5 million euros in 2023, an increase of 113.50% (more than double) compared to the previous year. Gross operating income from recurring business was 306.4 million (+60.65%) and the operating margin stood at 204.1 million (+112%). Turnover reached 24,000 million euros (+21%) and customer funds increased to 8,500 million euros (+31.7%). The loan book closed the year at 9,900 million euros, up 14.9%, well in excess of the average for the market, which contracted by 0.7%, according to figures to November provided by the Bank of Portugal.
Operating costs were 102.4 million euros, an increase of 7.9 million, mainly due to higher salaries, new recruitment, investment in technology and the effects of inflation. The cost-to-income ratio was 17 basis points higher, at 33.7%. The NPL ratio continued the downwards trend that started in 2016, ending the year at 1.25% compared to 1.31% in December 2022.
The contributions of the business areas to the subsidiary's gross operating income were: Commercial Retail Banking, 60.62%; Corporate Banking, 38.33%, and Bankinter Consumer Finance, 1.05%.
Commercial Retail Banking. There was a further significant increase in strategic business items, with growth in on-balance sheet funds of 810 million euros, plus 821 million euros in off-balance sheet funds. The loan book increased by 10%, to 555 million euros, with the housing finance business (Crédito Habitação) playing a leading role, with lending up 18%. In the Private Banking segment, the customer base increased by 9%, with turnover up 35% and gross operating income growing by 52.18%. The business volume in the Premier segment improved by more than 12%, and gross operating income rose by more than 58%. Highlights in terms of products, include launch of the BK Online account and enhancement of the conditions of the Mais Ordenado account, combining a lack of maintenance fees with very attractive returns.
Corporate Banking. There was a significant increase in the volume of business managed by Corporate Banking, which increased by 36% to 2,970 million euros. The loan book increased by 23% (a 65% accumulated increase over the last two years), due to the contributions by international business, transactional business and investment banking. Gross operating income rose by 59%. There was a 26% increase in the volume of business managed in medium-sized enterprises (1,940 million euros). This segment generated gross operating income of 26.8 million euros (+77%), with a significant increase in fee and commission income (+34%) and a 13% increase in the customer base. The volume managed by the business segment totalled 2,376 million euros, 1,455 million in funds and 921 million in lending. Lending in the International Business increased by 12% in 2023 with revenue up 36%.
Bankinter Investment was involved in: the structuring of the 230 million euro bond loan issued in June by the autonomous region of the Azores; medium-term financing backed by infrastructure and renewable energy assets amounting to 85 million; and placement in Portugal of tranches of venture capital funds structured in Spain, with underlying infrastructure and sustainable assets.
Bankinter Consumer Finance Turnover increased by 20% to more than 471 million euros in arranged lending, with 237,000 current customer contracts. The bankintercard business represents around 44% of consumer credit balances. Self-service functionality for customers was enhanced and new consumer credit offers were created, such as vehicle and renewable energy loans, in addition to expanding the offering of payment protection insurance. Current partnerships and new collaborations continue to form a core part of the growth of the consumer business. 2023 was marked in particular by completion of an ambitious project: the partnership with Sonae/Universo, the development strategy for which involves promoting digitalisation and offering new products and services that make a difference in the market.
Bankinter Asset Management: Activity in this area benefitted from the markets recovering, particularly for bonds, with 1,147 million euros of assets under management (+9%). The volume of investment funds under management amounted to 357 million euros (+13%). The range of bond funds contributed greatly to this, particularly the Bankinter Obrigações PPR 2025 and 2027 funds. The value of assets in the third-party portfolio management business stood at 791 million euros, up 7% as a result of the recovery of financial markets, which more than offset the lack of new business caused by the resurgence of term deposits as a valid alternative to investing, especially in the second half of 2023.
Bankinter Seguros de Vida. Growth in premiums written outperformed the market, demonstrating the resilience and confidence of customers in risk and investment products. The performance of life insurance linked to the Crédito Habitação mortgage and consumer credit stood out, with growth of 3% and 8%, respectively. Non-credit insurance, which is increasingly becoming a financial protection measure for families, grew by more than 10%. With regard to investment insurance, capital and guaranteed income products were marketed once again, taking advantage of the favourable changes in interest rates. This included launch of a specific product aimed at retired customers who decide to sell their homes and reinvest the income.
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