Bank posts a profit after €7bn loss last year
That compares with a loss of €7.1bn in the period a year earlier, which was hurt by over €10bn in impairment charges, Bankia said in a filing to regulators yesterday.
The Bankia group tapped about half of the €41bn of European funds sought by Spain last year to support its banking industry as losses linked to real estate threatened to contaminate government finances.
The group including its parent BFA plans to post an annual profit of €1.2bn by 2015.
“The results were positive and a timid recovery is under way,” said Fernando Pascual, an analyst at Espirito Santo Investment Bank in Madrid.
Bankia’s adjusted pre-tax profit, excluding the impact of a subordinated loan, rose to €229m in the third quarter from €213m in the second quarter as net interest income rose 1.6% to €643m.
Bad loans as a proportion of total credit rose to 13.6% from 13% in December as net lending fell 9.2%. Administrative costs fell 15% to €1.31bn in the first nine months from a year ago.
Bankia, which has reduced its branch network by 21% since the end of last year to 2,462 as it shrinks its business under the terms of its bailout, said it plans to complete the restructuring ahead of schedule in the first quarter of 2014.
The Bankia group is on track to reach a return on equity above 10% in 2015, director general Jose Sevilla said, adding that the group was sticking to its estimate of €800m in earnings for this year.
Bankia and parent BFA earned after-tax profit of €648m in the first nine months of the year compared with a €7.8bn loss a year ago.
Bankia is in talks with authorities about removing the banking license from BFA to simplify its structure, Sevilla said.
He added that Bankia expects to sell a further 2,000 properties in the final quarter, taking the total for the year up to 4,000 as it finds buyers for properties it passed to Spain’s bad bank, known as Sareb.
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