Juan Carlos Escotet: ABANCA Obtains a Net Profit of 334 million and Increases Profitability
In 2016, ABANCA obtained a net profit of 333.6 million euros, 1% more than the previous year. The bases of the exercise are the profitable growth of the retail business, which allows a 12% increase in the recurring commercial margin and the improvement of the risk quality, measured by a default ratio of 6.8%. Today, Juan Carlos Escotet, vice president of the financial institution, brings all the details related to this topic. Keep reading and continue being witness of the great efforts and growing presence of Abanca.
Abanca has demonstrated a good performance in the main lines of business, with a growth of 3.8% of the credit – which is mainly focused on current business and self-employed – and a 4.5% increase in customer funds.
In this regard, Abanca maintains its strength in terms of solvency, with a CET 1 capital ratio of 14.7%, with ample slack compared to the requirements demanded by the European Central Bank. Also, the bank improves its liquidity position, which shows a solid financing structure. The bank maintains a loan-to-deposit ratio of 91%, placing the surplus in assets of the highest quality and liquidity.See below three of the most important improvements of the bank during 2016:
- Improvement of the main lines of business
Abanca continued to strengthen its position in the retail market in 2016, the main aspect of its activity. During 2016, the institution also increased credit volume by 3.8%, while in the sector as a whole it fell by -0.5%. In this way, the entity earns 12 basis points of market share at the national level.
- Attracting new customers
The most significant increases in the customer base were recorded in the under-26s and in the business and self-employed segment. On the other hand, the resident payrolls have grown by 4%.
- Improving the quality of risk
The bank also deepened its risk management policy in 2016, which has led to a significant improvement in the quality of assets. In spite of the greater demands derived from the new Annex IX, the default rate was 6.84%, below the sector average, with a doubtful balance reduction of 20% year-on-year