Caixabank Sa Unsp/Adr

Good morning and welcome to the CaixaBank results presentation for the second quarter of 2026. As usual, we are joined today by our CEO, Gonzalo Gortazar, and our CFO, Javier Pano. In terms of logistics, a brief reminder, we plan to spend about 30 minutes with the presentation, followed by a Q&A, and you should have received instructions by email on how to participate. We have the press conference immediately afterwards, so we will need to be mindful of the time today and wrap up promptly. My team and I will be at your full disposal after the call for follow-up questions. And without further ado, Gonzalo, the floor is yours.

Thank you, Marta, and felicidades. Santa Marta today on top of the World Cup but anyhow second quarter I'd say the highlights are very clear it's how successful we've been in the market in terms of our commercial traction you have a few figures here customer funds and performing loans both growing eight percent level well above what we were expecting and and we're very Thank you very much. Gaining market share as we like is just gradual. We're too big to be growing too fast in this market, but it's just a gradual trend. Fifteen basis points in payroll is very relevant. You look at the insurance side where we have a very clear, strong position in life savings and life risk. We see very strong growth. Also in non-life insurance where We're increasingly becoming a leading player in the market. So very satisfied to see that our commercial machine is working at full speed. Revenues are growing as guided in terms of NII and, in fact, accelerating. Revenues from services, 7.4%. NII was up 2%. Asset quality, big. Thank you very much. Thank you very much. Very strong second quarter. The economy is doing well. We are actually upgrading back our estimates for growth in Spain from 2.1 percent to 2.4 percent. As you know, we had some softening of our expectations once the Iran war started, and in the current, obviously, there's a lot of volatility we cannot Javier Pano Riera, Luis Javier Blas Agueros, Marta Nogueros, Maria Luisa Martinez Gistau, Thank you very much. We'll discuss a lot on rate curve and expectations during today's, but you can see obviously a steepening, very significant steepening of the yield curve, particularly again not just during the second quarter, but also in July. And then, as you know, we keep having in Spain some structural reasons for this strong growth, which we expect to last for the foreseeable future. The detail of commercial momentum, as you can see, business volume up 7.8%. It's actually accelerating from last year. And this is kind of the trend we see almost at every indicator we look. It's a strong growth. And even if last year it was pretty good, we're seeing it even better now. Customer acquisition, payroll, and you see that, again, in payroll deposits, 36%. We keep, obviously, improving our position in the market, and as I said, very significant increase, other than deposits and private sector loans, also in insurance, where the numbers are actually I wouldn't say surprisingly high because we have been delivering those very often in the past, but they still are quite shocking. Imagine, I would say No News continues to do very well, 20% year-on-year growth. I just wanted to make sure that everybody understands that despite the very strong competition that we have from established and new entrants in the market, Imaging continues to do very well and as you can see in some comparison with neobanks is clearly in terms of business volume the leading neobank in Spain and we're planning to keep it that way. Transformation is critical, easy to observe, but obviously a driver of long-term competitiveness for us. We continue to maintain our app as the number one ranked according to Google Play in Spain, which is no small feat given how many. and many more. Javier Pano Riera, Luis Javier Blas Agueros, Maria Luisa Martinez Gistau, David Lopez Puig Javier Blas Agueros, Maria Luisa Martinez Gistau, David Lopez Puig Thank you very much. Thank you. Obviously, keep growing our market share, our revenues. On the lending side, very strong growth. Residential up 6.7% year-on-year. Consumer, residential mortgages, consumer more than double G or double G, 11.5%. And business lending also in double D territory. Obviously, in business lending, there's a contribution around half of that growth is coming from outside Spain and Portugal, EAE. Our international branches continue to grow nicely, even though they will gradually keep bringing some growth to the overall Lombok. Thank you very much. We look at granularity in our franchise, our ability to get to sort of the small part of the market, which is more profitable, The customer funds, we had an extraordinary quarter, particularly the market impact after a weak first quarter with the Iran war. Javier Pano Riera, Manuel Galarza Pont, Maria Luisa Martinez Gistau, David Lopez Puig Margin and relevant deposits, you see growth of 5% Gaining market shares, light gain, but that is what is Thank you very much. Thank you very much. Thank you very much. The long-term track record of growth in life risk is staggering when looking at what the market has done over the last 10 years. So that's really it. We continue to look at the future with confidence. We have a great, certainly in relative terms, great economies in which we operate. Our clients are very well positioned in terms of the leverage they have relative to the EU average and that makes a difference because they are a more resilient and b we have more potential to grow. The rate outlook is certainly positive even if it generates obviously volatility but we have the franchise, the momentum and the balance sheet to keep delivering and that's what we plan to do. Thank you.

Okay then, from my side, as always, and good morning, sorry. As always, the usual comments on the P&L and the balance sheet. On the first slide of my part of the presentation, here you have the consolidated income statement, a net income of 1 billion, 631 million. This is up by slightly over 10% year-on-year, also up by close to 4% quarter-on-quarter, 18% ROTE, as Gonzalo already commented. And moving upwards to revenues, NII, with its growth is gathering pace, up by 3.5% year-on-year, 2.5% quarter-on-quarter, details in a couple of slides. Revenues from services exceeding our initial expectations honestly here with strong momentum from wealth management and protection and as you may see revenues from services up by more than 7% year-on-year and also up quarter-on-quarter. On other revenues, everything is pretty much in line with a strong contribution from equity accounted, basically from Segur Caixa Deslas, and a slightly weaker trading this quarter. Then on expenses, everything also is evolving according to our plans, up by 4.3% year-on-year. Then on loan and loss charges, we have a slight increase in Euro terms, but as you may see, in terms of cost of risk, we are pretty much in line at 24 basis points. and this is due to the recalibration of the macro scenarios for IFRS 9 models that something we can discuss in in a few slides. Other provisions slightly better also than initial expectations and then on gains and losses we have a strong profit here from the disposal of other real estate assets repossessed assets basically taking advantage of very good market conditions in Spain and this is something that may continue for some more quarters as we continue to dispose at a very good pace and with good margins. On taxes, my final comment on this slide is going to be that we have a write-up of 135 million DTAs as in previous quarter. We go to Portugal now with a net income for the first half of 218 million. Business volume is also doing very well in Portugal, as you may see, up by 7% year on year, with a clear outperformance since we took control versus the industry. We are gaining market share in Portugal across key products from mortgages to business lending and wealth management, as you may see, and also with high profitability with an ROTE 16.7%, pretty close to the average for the group, strong balance sheet also, NPS just 1.5%, strong coverage 81%, and rating upgrades also at Portugal level, so Fitch A plus from single A and also an upgrade from Moody's to A1 for seniors. We have some KPIs of the AI and IT transformation that is also taking place in Portugal as in group level. Let's move to the core of the presentation, the usual NII slide, focusing first on the central quarterly bridge. You may see here, on a quarter-on-quarter basis, NII up by 2.5%. We have a slight negative from client yields. There is some impact from some non-recurrence we can discuss. This is set to clearly improve in coming quarters, adding to NII progression. On the right hand side you may see a comment on front book loan yields already being accretive and moving upwards, so this is going to support. Also that part of the NII bridge. Then strong support from volumes and also ALCO. And if we move to the upper left chart here to take a broader or longer term view, you have the comparison of the same bridge for the first half this year, first half last year, where you may see that the negative from client yields due to the repricing of floating rate loan books is much more than compensated by volumes and ALCO. Talking about Talco, I commented last quarter that we had, to some extent, front-loaded plenty of our hedging activities to the first quarter, taking advantage in March of a strong increase in market rates. So this quarter the activity has been more subdued. We have added 2.7 billion to hedges, current stock 77 billion, and a slight increase on the fixed income portfolio. Javier Pano Riera, Luis Javier Blas Agueros Thank you very much. Precisely, talking about deposits, let's zoom in on precisely our deposit balances. Here, remember, we have the quarterly average evolution. You may see that it's up by 4.7% year-on-year, but the most interesting part, as always, is the mix, where you may see that non-interest-bearing are progressing pretty well, up by 5.5% year-on-year, while we keep interest-bearing Javier Pano Riera, Luis Javier Blas Agueros, Maria Luisa Martinez Gistau, David Lopez Puig To the cost of our interest-bearing deposits, up by 5 basis points to 161%, and you see below that 12-month arrival this quarter up by 44 basis points, an upward trend that already started some quarters ago. Moving to another key P&L line, revenues from services that are doing pretty well, also taking, let's say, a longer-term view on the left part of this slide. This is first half versus first half. You may see clearly that wealth management and protection are well into a double-digit progression and a slight negative from the rest of banking fees. But if you combine wealth management, protection, and CIV, This is up by more than 12% year-on-year, so first half this year, first half last year. Quite a good performance. You see the quarterly evolution and what is behind the strong performance in world management is what Gonzalo already commented, strong inflows, very positive momentum on that front with inflows, I would say, in line with the pace of last year. and also with a strong contribution from MarketFX, which is also quite a positive. And then protection insurance, also strong growth. You saw the increase of insurance premium that is also Thank you very much. On this line we have the, excuse me, we have the, also we are including on fees the impact of the SRTs. You have all the details on the full note below. And what they know that we are being more and more active on that front. So this is also having some small impact into, let's say, recurring banking fees evolution. Costs, not much to say. If you look first half versus first half, up by 4.5% in line with our guidance. You may see that general expenses and depreciation are growing at a faster pace as a result of the execution of our intense plan on AI and IT transformation. and well we have cost to income slightly below 40% which compares extremely well with the peer average that is still over 50%. We move to MPLs and cost of risk. On MPLs, you may see that we have a strong reduction of the stock, circa 500 million. There are some portfolio disposals, but on top of that, there is a very positive, let's say, MPL organic evolution. The ratio comes down to 78%, coverage 81%. You may see that the evolution of MPLs across the different segments is very benign, very favorable, so we are not observing any sign of deterioration at all. And then on IFRS 9 models updates, back to my initial comment, we have included a problem recalibration of the macro scenario weightings. and many more, including an additional scenario that is wasting 10% of supply shock. That's a downside risk scenario as a result of a supply shock. As a result of that, we are assigning 40 million of the overlays and we are having an extra impact on loan loss charges, approximately of circa 30 million. Thank you very much. The equity cover ratio 184%, NSFR 143%, and the loan to deposit ratio that although is growing as we are growing faster on lending than on deposits, but very comfortable levels. And all that compares extremely well with peers, as you may see below. and this is as a result of a strong and stable deposit base with two-thirds the weight of stable retail deposits and operational corporate deposits being almost two-thirds of our deposit base. M-REL, a few words on that, M-REL ratio at 27-26%, that's an M MDA buffer of 286 basis points. The MDA buffer is also in this slide, very comfortable, 339 basis points. And on the right hand side you have the performance of our issuance plan that we are executing More than 60% already executed and slightly over 40% issued in foreign currency, hence strongly diversifying our investor base. I would remark one billion Australian dollar senior preferred in May and two billion US dollars senior non-preferred in April. Also rating upgrades at group level. We already disclosed about Moody's last quarter, but here You have also Fitch with an upgrade also at group level to A plus from single A. And finally, capital. We have capital accretion this quarter of 69 basis points. We are investing into organic growth, 23 of those. Then we have for dividends and 81s, 42 basis points, no other impacts. So we are ending the quarter with a CT1 ratio of 12.54%. and finally on the right hand side of the slide you have the evolution of the book value per share up by 14.5% once adjusted for the DPS. My final comment is going to be that the board is planning to approve an interim dividend of between 30 and 40% of the first half net income to be paid in November. So thank you very much and I'm sure that we have a few questions. Thank you.