CaixaBank S A : 1st semester 2022 Business Activity and Results (Open in a new window)

Business

activity

and results

January-June

2022

Contents

04 Key Group figures

05 Key information

08 Macroeconomic trends and state of the financial markets

10 Income statement and comparative proforma income statement

22 Business Activity

25 Risk management

28 Liquidity and financing structure

30 Capital management

33 Segment reporting

46 Sustainability and social commitment

49 The CaixaBank share

51 Investment portfolio

51 Ratings

52 Appendices

52 Alternative performance measures

60 Reconciliation between the accountingand management information

63 Historical figures for the CABK and BPI perimeters

66 Activity indicators by region

Business activity and results: January - June 2022| 1

Note: The financial information contained in this document is unaudited and, accordingly, is subject to change. The consolidated income statement and the consolidated balance sheet and the corresponding breakdowns of those statements provided in this report, ar e presented under management criteria, but have still been prepared in accordance with International Financial Reporting Standards (IFRS-EU) as adopted by the European Union under the terms of Regulation (EC) No 1606/2002 of the European Parliament and of the Council of 19 July 2002, as subsequently modified. In preparing these statements, Circular 4/2017 of the Bank of Spain of 6 December, as subsequently modified, has also been taken into due account in that it adapts IFRS-EU to Spanish credit institutions.

This report has been prepared from the accounting records of CaixaBank, S.A. and the other Group companies, and includes certain adjustments and reclassifications required to apply the policies and criteria used by the Group companies on a consistent basis with those of CaixaBank. For this reason, and specifically in the case of BPI, the information contained in this document does not coincide with certain aspects presented in BPI's publication of financial information. Likewise, the financial information regarding investees has been prepared primarily on the basis of estimates made by the Group's directors, hereinafter the "Company".

Figures are presented in millions of euros unless the use of another monetary unit is stated explicitly, and may be expressed as either million euros or € million. Certain financial information in this report was rounded off and, specifically, the figures shown herein as totals may differ slightly from the arithmetic sum of the individual figures given before them.

In accordance with the Guidelines on Alternative Performance Measures (APMs) published by the European Securities and Markets Authority

on 30 June 2015 (ESMA/2015/1057), the appendices hereto provide the definition of certain alternative financial measures and, where appropriate, the reconciliation with the items contained on the financial statements for the period in question.

In accordance with the Amendments to IFRS 4 and subsequent reviews, the Group has decided to apply temporary exemption from applying IFRS 9 to the financial investments of the Group's insurance firms for all periods that come before 1 January 2023, aligning its first application with the entry into force of the new IFRS 17: Insurance Contracts (expected on 1 January 2023), which will govern the presentation and measurement of insurance contracts (including technical provisions). Accordingly, these investments are measured in accordance with IAS 39 and grouped under the heading "Assets under the insurance business" on the balance sheet. To make the information more readily comparable , the Group has also grouped together the technical provisions corresponding to Unit Link and Flexible Investment Life Annuity (the part managed), which are now reported jointly under 'Liabilities under the insurance business'.

Business activity and results: January - June 2022| 2

Commercial positioning

CLIENTS

BUSINESS ACTIVITY

20.4

704,505

624,087

in customer funds (€ million)

million

Balance sheet indicators

RISK MANAGEMENT

3.2%

NPL ratio

65%

NPL

coverage ratio

0.23%

Cost of risk (12 months)

in total assets (€ million)

362,770

in loans and advances to

customers (€ million)

CAPITAL ADEQUACYLIQUIDITY

12.4%	162,847
CET1	in total liquid assets (€ million)

16.6%	323%
Total capital	liquidity coverage ratio (LCR),
	trailing 12 months

24.6%150%

MREL

NSFR

Results, profitability and cost-to-income

ATTRIBUTABLE PROFIT/(LOSS)

COST-TO-INCOME

PROFITABILITY

1,573	56.1%	7.9%
million euros	cost-to-income ratio stripping out	12-month ROTE
extraordinary expenses	ex M&A impacts
	(12 months)

Business activity and results: January - June 2022| 3

Key Group figures

€ million / %	January - June	Change		2Q22	Quarter-on-
						quarter
	2022		2021
PROFIT/(LOSS)
Net interest income	3,156		2,827		11.6%		1,606	3.6%
Net fee and commission income	1,994		1,640		21.6%		1,026	5.9%
Core income	5,649		4,899		15.3%		2,888	4.6%
Gross income	5,655		4,883		15.8%		2,880	3.8%
Recurring administrative expenses, depreciation and amortisation	(3,011)		(2,747)		9.6%		(1,488)	(2.3%)
Pre-impairment income	2,621		166		-		1,376	10.6%
Pre-impairment income stripping out extraordinary expenses	2,644		2,136		23.8%		1,392	11.2%
Profit/(loss) attributable to the Group	1,573		4,181		(62.4%)		866	22.5%
Profit/(loss) attributable to the Group ex M&A impacts in 2021	1,573		1,278		23.1%		-	-
MAIN RATIOS (last 12 months)
Cost-to-income ratio	57.6%		75.8%	(18.1)		57.6%	(18.7)
Cost-to-income ratio stripping out extraordinary expenses	56.1%		54.3%	1.8		56.1%	(1.3)
Cost of risk1 (last 12 months)	0.23%		0.30%	(0.07)		0.23%	-
ROE1	6.8%		8.2%	(1.5)		6.8%	0.3
ROTE1	7.9%		9.8%	(1.9)		7.9%	0.4
ROA1	0.3%		0.5%	(0.1)		0.3%	0.0
RORWA1	1.1%		1.4%	(0.3)		1.1%	0.1

	June	December			March	Quarter-on-
	Change
	2022		2021		2022	quarter
BALANCE SHEET
Total assets	704,505	680,036	3.6%		689,217	2.2%
Equity	34,843	35,425	(1.6%)		35,916	(3.0%)
BUSINESS ACTIVITY
Customer funds	624,087	619,971	0.7%		619,892	0.7%
Loans and advances to customers, gross	362,770	352,951	2.8%		353,404	2.7%
RISK MANAGEMENT
Non-performing loans (NPL)	12,424	13,634	(1,209)		13,361	(937)
Non-performing loan ratio	3.2%	3.6%	(0.4)		3.5%	(0.3)
Provisions for insolvency risk	8,126	8,625	(498)		8,648	(522)
NPL coverage ratio	65%	63%	2		65%	-
Net foreclosed available for sale real estate assets	2,110	2,279	(169)		2,223	(113)
LIQUIDITY
Total Liquid Assets	162,847	168,349	(5,502)		171,202	(8,355)
Liquidity Coverage Ratio (last 12 months)	323%	320%	3		325%	(2)
Net Stable Funding Ratio (NSFR)	150%	154%	(4)		154%	(4)
Loan to deposits	88%	89%	(1)		89%	(1)
CAPITAL ADEQUACY
Common Equity Tier 1 (CET1)	12.4%	13.1%	(0.7)		13.4%	(1.0)
Tier 1	14.4%	15.5%	(1.1)		15.7%	(1.3)
Total capital	16.6%	17.9%	(1.3)		17.9%	(1.3)
MREL	24.6%	25.7%	(1.1)		25.7%	(1.1)
Risk-weighted assets (RWAs)	215,521		215,651	(130)		214,249	1,272
Leverage ratio	4.6%	5.3%	(0.7)		5.2%	(0.6)
SHARE INFORMATION
Share price (€/share)	3.317	2.414	0.903		3.077	0.240
Market capitalisation	26,079	19,441	6,638		24,779	1,300
Book value per share (€/share)	4.43		4.39	0.03		4.46	(0.03)
Tangible book value per share (€/share)	3.75		3.73	0.01		3.80	(0.05)
Net income (ex M&A impacts) attributable per share (€/share) (12 months)	0.30		0.28	0.02		0.28	0.01
PER (Price/Profit, ex M&A impacts; times)	11.21		8.65	2.56		10.85	0.35
Tangible PBV (Market value/ book value of tangible assets)	0.88		0.65	0.24		0.81	0.07
OTHER DATA (units)
Employees	45,022		49,762	(4,740)		46,480	(1,458)
Branches2	4,543		5,317	(774)		4,824	(281)
Of which: retail branches in Spain	3,934		4,615	(681)		4,213	(279)
ATMs	13,095		14,426	(1,331)		13,568	(473)

1. The 2021 ratios do not include in the numerator the results generated by Bankia before 31 March 2021, which is the recognitio n date of the merger for accounting purposes or, for consistency, the contribution of the incorporated RWAs or balance items in the denominator. They neither consider the extraordinary impacts associated with the merger.
2. Does not include branches outside Spain and Portugal or representative offices.

Business activity and results: January - June 2022| 4