CaixaBank posts record €5.9B profit in 2025, boosts dividend and targets

Core Viewpoint - CaixaBank achieved a record net profit of €5.891 billion in 2025, marking a 1.8% increase from the previous year, despite a decline in net interest margin due to falling interest rates [1] Financial Performance - The bank's business volume grew by 6.9% to €1.1 trillion, with a 7% expansion in the performing loan book and a 6.8% increase in customer resources, indicating broad-based growth across its activities [1] - Income from services rose by 5.4% to €5.266 billion, while gross income increased by 2.5% to €16.27 billion [1] - Return on tangible equity (ROTE) decreased to 17.5% from 18.1% the previous year, reflecting the impact of reduced interest rates [1] Dividend and Shareholder Remuneration - The board proposed a complementary dividend of €2.32 billion, bringing the total dividend for 2025 to €3.499 billion, which is 15% higher than the previous year [1] - Total shareholder remuneration for 2025 is 59.4% of consolidated net profit, with a commitment to maintain a payout of 50%-60% of net profit in cash through 2026 [1] Strategic Targets and Growth Projections - CaixaBank revised its 2027 ROTE target from 16% to approximately 20%, with an average ROTE of over 18% projected for 2025-2027 [1] - The bank increased its net interest income projection from over €11 billion to close to €12.5 billion by 2027, driven by increased volumes and favorable macroeconomic conditions [1] Capital Strength and Asset Quality - The non-performing loan ratio improved from 2.6% to 2.1%, and the coverage ratio rose to 77%, with a decrease in the stock of questionable loans by €1.611 billion [1] - The fully loaded CET1 capital ratio increased from 12.2% to 12.6%, and the liquidity coverage ratio stood at 202%, significantly above the required minimum [1] Market Reaction - Following the announcement, CaixaBank shares rose by more than 3.6%, leading gains on Spain's IBEX 35 index [1]