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Caixa Geral swings to H1 profit from year-ago loss

Caixa Geral de Depósitos SA, which concluded in June the last phase of its €5 billion state-backed recapitalization plan, reported a first-half net income of €194.1 million, compared to a restated net loss of €49.9 million in the same period in 2017.

Gross return on equity stood at 9.5% at the end of June, up from 4.0% a year earlier.

Net interest income declined on a yearly basis to €593.3 million from €605.8 million, while net fees and commissions increased to €239.2 million from €218.2 million.

Net trading income amounted to €50.9 million in the first half, down from €217.9 million a year ago, due to the less favorable evolution of interest rates deriving from higher levels of volatility in the financial markets, according to the Portuguese lender.

Total provisions and impairments amounted to €44.8 million in the period, down from €390.3 million a year earlier.

Caixa Geral's nonperforming loan ratio stood at 10.5% as of June 30, down from 13.5% a year earlier. The NPL coverage ratio was 61.6% at June-end, compared to 52.0% a year ago.

The Portuguese lender's fully implemented and phased-in common equity Tier 1 ratios both stood at 14.0% at the end of June, unchanged from 14.0% at the end of 2017.