Banca Sistema (BST) Q3 2025 earnings summary

Executive summary

• Net profit rose 71% year-over-year to €21.0 million, driven by a 25% increase in net interest and commission income, lower funding costs, and operational efficiency improvements.

• Total income increased 25% year-over-year to €106.2 million, with the Factoring Division as the main contributor, supported by Superbonus tax receivables trading.

• Operating costs increased 6.8%-7% year-over-year, mainly due to higher administrative and compliance expenses.

• Key regulatory and governance changes were implemented following supervisory feedback, including a new Executive Committee and reclassification of certain credit exposures.

• Total assets decreased 8%-8.2% year-to-date, mainly due to lower customer loans and financial assets.

Financial highlights

• Net interest income rose 48%-49% year-over-year to €48.3 million.

• Adjusted net interest income (including Superbonus trading) was €71.1 million, up 28% year-over-year.

• Net profit attributable to shareholders was €21.0 million, up 71% year-over-year.

• Cost of risk stood at 42 basis points for the first nine months, up from 20bps in 9M24.

• Operating expenses increased 7% year-over-year, mainly due to higher administrative costs.

Outlook and guidance

• Margins across core businesses expected to remain stable through year-end; factoring and CQ margins stable, pawn margins supported by accelerated auctions.

• Net interest income and total income in Q4 expected to be stable or slightly lower than Q3, with cost of risk around 40 basis points.

• Cost of funding expected to end 2025 at 2.9%-2.95%, below previous guidance.

• Capital optimization actions and ongoing securitizations are expected to support further growth in factoring operations with limited capital absorption.

• No government repayment from municipalities in conservatorship expected in Q4; potential upside if legal actions accelerate.