In Q1 2025, National Bank reported a profit after tax of €381 million, showcasing robust earnings and a continued decrease in credit risk costs.
The bank experienced a 9% year-on-year drop in net interest income in the first quarter, consistent with predictions for 2025, largely due to a significant reduction in interest rates (approximately 100 basis points combined in Q4 2024 and Q1 2025). This decline was partially offset by strong credit expansion, effective customer deposit hedging, and improved deposit mix strategies.
Additionally, there was a 13% increase in fees compared to the previous year, driven by strong growth in both Retail (+15% year-on-year) and Corporate Banking (+35% year-on-year). The cross-selling of investment products remains strong, with commissions on investment products rising by 60% year-on-year, alongside maintaining impressive market share growth in mutual funds from 2024 into Q1 2025.
Moreover, the bank experienced:
Recurring operating expenses rose by 5% annually in Q1 2025, reflecting higher staff costs from increased salaries and variable pay, along with investments in human capital such as recruitment and skill development. The benefits from the Voluntary Severance Program implemented in Q4 2024 will be fully realized in the latter half of 2025 and onwards.
Credit risk costs were recorded at 46 basis points in Q1 2025, down from 49 basis points in Q4 2024, indicating positive trends in the quality of the loan portfolio.
The return on equity stood at 19.1%, or 16.5% when normalizing for elevated financial operations income in Q1 2025 (excluding adjustments for excess CET1 capital above our internal target of 14%), significantly surpassing our 2025 goal of over 13%.
– Our balance sheet remains highly liquid and well-capitalized.
The annualized growth in performing loans reached 12% in Q1 2025, exceeding our target of approximately 8% average growth per year over the next three years, with net credit expansion for the quarter totaling €0.34 billion.
Loan disbursements amounted to €1.6 billion in Q1 2025, representing a 41% year-on-year increase, primarily driven by corporate clients.
The optimization of corporate clients’ balance sheets witnessed in Q1 2025 was reversed in April 2025, as Corporate Banking deposits surged by €0.4 billion.
Ask me anything
Explore related questions
