On July 23, 2023, Spanish bank Sabadell announced a remarkable increase in its net profit for the second quarter, reporting a 34.5% rise compared to the same period in the previous year. This boost can be attributed to increased revenue from loans while the bank navigates a hostile takeover bid by its competitor, BBVA.
Sabadell, the fourth-largest bank in Spain by market value, recorded a net profit of €483 million ($525.84 million) for the April to June period. This figure exceeded analysts’ expectations, who had anticipated a profit of €422 million based on a recent Reuters survey.
In its efforts to reassure shareholders of its independent viability, Sabadell plans to distribute €2.9 billion to shareholders, funded by profits expected in 2024 and 2025. This figure surpasses their previously announced target of €2.4 billion.
The bank’s interest margin, which represents the difference between lending profits and deposit costs, rose by 7.8% year-on-year, reaching €1.26 billion. This was slightly above analysts’ estimates of €1.24 billion, and it also marked a 2.5% increase from the previous quarter.
Spanish banks, primarily retail lenders, have enjoyed increased income from the higher interest rates charged on loans, many of which have variable rates. At the same time, they have managed to keep interest rates paid to savers relatively low.
For reference, the exchange rate was approximately 1 USD = 0.9185 euros at the time of the report.
This shift in profitability indicates a confident outlook for Sabadell as it positions itself amidst a competitive banking landscape.
Image suggestions:
- An image of the Sabadell bank logo.
- A graph showing the increase in net profit over the past year.
- A depiction of the competitive landscape among Spanish banks.
For more details on Sabadell’s financial performance, check out the full report here.
Image and News Source: https://es-us.finanzas.yahoo.com/noticias/sabadell-aumenta-35-beneficio-neto-070402416.html
