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Grupo Cajamar records profit of €14 million while continuing to bolster coverages in current economic context

07 de Mayo, 2021

Solid performance in its business fundamentals allows the Group to set aside €512 million —more than its entire gains on financial transactions— to expand coverages, provisions and impairments, and continue paring non-performing assets and strengthening its solvency.

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  • Customer funds under management rose 15.3% to €41,685 million, lifted by the 23.3% increase in sight deposits and 32% advance in mutual funds.

  • Performing loans grew 9.3% to €32,804 million, with an 11.8% increase in loans to the agri-food sector and corporates.

  • The recurring cost-income ratio, without including Gains (losses) on financial transactions, is now 58.8%, reflecting growth in gross income and containment of operating expenses.

  • Effective management of total risks, with a year-on-year reduction of 17.6%, brought the NPL ratio down 1.36 percentage points to 4.46%, in convergence with the sector average, while the NPL coverage ratio rose to 69.48%, an improvement of 19.68%.

  • The capital adequacy ratio recorded a significant gain of 1.1 points to end the quarter at 15.5%, highlighted by the strong quality of qualifying capital; the phased-in CET 1 ratio rose to 13.8%, and the fully-loaded ratio stands at 13.3%, amply surpassing regulatory requirements.

  • The Group, with a customer base of more than 3.5 million, now has 967,000 digital customers, a full 14.9% more than in the same quarter in 2020, some 509,000 of whom use the electronic banking service, a gain of 7.3%, and 765,000 are mobile banking users, up 30.8%.

Business Growth

The robust business performance boosted total assets 13.7% YOY to €54,794 million, while the volume of funds under management was growing 11.29% to close the quarter at €89,498 million.

Customer funds under management rose 15.3% with respect to the same period of the previous year and now stand at €41,685 million, buoyed by a 23.3% increase in sight deposits and 32% advance in mutual funds.

Performing loans are up 9.3%, led by lending to businesses and the agri-food sector, which was up 11.8% from one year earlier.

Grupo Cajamar works to offer its customers a comprehensive range of solutions, as part of the drive to deepen its role as lender to the real economy and to offer more flexible payment terms to customers who run into temporary difficulties caused by the pandemic. It has thus moratoria granted of €1,033 million, primarily to households, of which only €482 million remain outstanding. The amount of guarantee loans from the Spanish Official Credit Institute (ICO) totals €1,954 million, 70% of which are to small and medium enterprises and 21% to large companies. Despite this broad financial support for sectors affected by Covid-19, the Group has limited exposure to the hardest hit sectors, such as leisure, passenger transport, hotels and restaurants, among others, which account for just 7% of the performing retail loan book.

By turnover the Group ranks ninth among Spanish significant institutions, eighth by gross income, and remains the go-to bank for the primary sector with a market share that has widened to 15.23%. Its knowledge of the agri-food sector enables it to offer a wide and specialised range of products and services, as well as technical and specialist advice and transfer of know-how to companies, co-operatives and producers. A notable development in this area was the launch during the first quarter of the year of 'Plataforma Tierra' (www.plataformatierra.es), a Grupo Cajamar initiative aimed at contributing to the transformation and digitalisation of the agri-food sector in its campaign to support and accelerate the creation of new solutions for partners and customers.

Atención al cliente

Advances in digitalisation

Grupo Cooperativo Cajamar continues broadening its offering of value added products and services to its more than 3.5 million customers and advancing in its digitalisation strategy, as borne out by its more than 967,000 digital customers, a gain of 14.9% from one year earlier; 509,000 electronic banking customers, 7.3% more than the same period of 2020; and 765,000 mobile banking users, up 30.8%.

This has all been made possible thanks to the hard work of its 5,357 professionals, working in 909 branches, including the new office opened in Vigo (Pontevedra) during the first quarter of this year, 146 agencies, 1,577 ATMs and its digital banking, App and mobile banking channels.


Given the economic and social context brought about by the Covid-19 pandemic, Grupo Cooperativo Cajamar pursues a strategy of prudence and is allocating the lion's share of the income obtained by its solid business performance and its gains on financial transactions to strengthening reserves, provisions and writedowns of intangible assets to bolster the Group's capital adequacy. More than €512 million were allocated to such coverage in the first quarter, €461 million of which came from gains on financial transactions. This has boosted the NPL coverage ratio to 69.48%, some 19.7 percentage points higher than one year earlier.

This prudent management approach has led the Group to report a consolidated net profit of €14 million, 18.7% lower than recorded in the same period of the previous year.

Net interest income recorded a strong gain of 27.7%, mainly lifted by the increase in interest income and, to a lesser extent, by the reduction in interest expense, together with the healthy gains in the fundamental business figures.

The rise in net interest income helped lift gross income to €704 million, 204.5% higher than the same quarter one year earlier, also buoyed by gains on financial transactions with the sale of a bond portfolio. Even so, stripping out gains on financial transactions, gross income was up 13.1%, over the year earlier period.

The cost-income ratio likewise showed improvement thanks to higher gains on financial transactions to close the quarter at 20.3% and the recurring cost-income ratio (not including gains on financial transactions) moved to 58.8%, reflecting the 2.4% decrease in administration expenses.

Healthier balance sheet

Grupo Cajamar continues strengthening its balance sheet, setting aside a large part of its income to boost the NPL coverage ratio to 69.48%, a full 19.68 percentage points higher than the same quarter one year ago, and to improving the NPA coverage ratio, which now stands a 64.65%, after factoring in debt forgiveness in foreclosure procedures, 12.63 pp higher year-on-year.

The bank's handling of total non-performing assets also continues recording healthy results, with a 17.6% decrease from the same quarter in 2020 (€335 million lower), producing a new drop of 1.36 pp in the NPL ratio, which closed the quarter at 4.46%, close to the sector average.

The net volume of foreclosed assets continued to decline, recording a YOY drop of 22.2%, helping improve the foreclosed assets coverage ratio to 62.03%, after considering debt forgiveness in foreclosure procedures, 8.61 pp higher YOY.

Deeper solvency and liquidity

The capital adequacy ratio recorded a strong gain of 1.1 points to 15.5%, with a high quality of own eligible funds, with the phased-in CET 1 ratio rising to 13.8% and 13.3% fully loaded, amply surpassing the regulatory requirements, all the more considering the measures implemented by the ECB in response to the Covid-19 crisis. The buffer over the supervisor's requirements stands at €1,581 million for the phased-in CET 1, at €1,232 million for T1 and €1,155 million for total capital.

Customer deposits continued growing for the 12th straight quarter, improving the loan-to-deposit ratio to 87.8%, 5.3 pp below the year-earlier figure.

Cajamar enjoys a comfortable level of wholesale funding and a healthy liquidity position with available liquid assets of €11,316 million, including both high quality liquid assets (HQLA) and other discountable liquid assets and deposits in central banks. In addition, the Group has a further €3,160 million in mortgage-backed bond issuance capacity.

All of this is reflected in the Group's comfortable compliance with the limits set by the European Banking Authority, with a liquidity coverage ratio (LCR) of 217.7% and a net stable funding ratio (NSFR) of 131.2%.


Agro DNA Community 

Grupo Cajamar continues supporting the agri-food sector, not just through its lending but also with knowledge-transfer initiatives and the activities of its Agri-food Knowledge Community, supported by the new 'Plataforma Tierra' (https://www.plataformatierra.es). These efforts involve Cajamar's own activities as well as its work with other entities, businesses and technology centres to share the latest agri-food innovations, technologies and know-how.

The Group also continues to support research, studies and testing in its experimental centres in Almería and Valencia, which received 13 professional visits in the first quarter of this year despite pandemic-imposed restrictions. It has also organised 26 virtual workshops and meetings for its Agro DNA community, which drew 3,870 participants.

During the first quarter Grupo Cajamar also published and presented a new report titled ‘Observatory of the agri-food sector in Spanish regions: 2019 Report’.

Sustainability commitment

In the first quarter of the year the cooperative bank Cajamar continued fulfilling its pledge to sustainability and once again offset the whole of its 2020 CO2 emissions. Specifically, the 1,076 tonnes of CO2 emissions were offset through the project ‘Conservation of the Amazonia in Madre de Dios, Peru’, contributing to the reforestation of the Amazon rainforest, fostering sustainable management and producing benefits for the local communities.

The Cajamar sustainability policy involves integrating and interrelating environmental, social and governance (ESG) aspects, placing the Group at the head of the sector in ESG risks management according to the Sustainalytics ESG Risk Rating report. That sustainability ratings agency emphasises the strength of the Group's corporate governance, with ESG policies and programmes that surpass the norm for the sector, and its sound management in such decisive area as business ethics, integrating ESG factors into finance, product governance and human capital. Also drawing attention were its general disclosure actions for ESG risks, bearing out its responsibility vis-à-vis investors and the general public. The agency also noted that environmental, social and governance matters are considered in charting the Cajamar business strategy.

In addition, Grupo Cajamar is a leading company in climate change management, as witnessed by the score given to it by the Carbon Disclosure Project (CDP). The CDP has acknowledged Cajamar's commitment to championing and pursuing actions relating to the challenges and opportunities of a low-carbon economy, especially those involving transformation of the agri-food sector, most notably through innovative programmes promoting more efficient and sustainable food production. The CDP has also applauded the launch of financial initiatives to measure and manage risks deriving from climate change, their impact on the loan book, and other steps to transparently disclose and manage the business's carbon footprint, and in doing so fulfil the new requirements on scoring methodologies and reporting.

As a member of the Green Recovery Alliance, Grupo Cajamar is also signatory to the manifesto for a green recovery in Spain. The manifesto includes a pledge to mobilise investments to lay the foundations for a global economic recovery that protects the environment and promotes social inclusion.

Grupo Cooperativo Cajamar
Press office

950 21 03 86 | comunicacion@grupocooperativocajamar.com