BAWAG Group AG

BAWAG reported second-quarter net profit of EUR 255 million, EPS of EUR 3.28, and return on tangible common equity of 29% (28.7% on the CFO’s slide). Core revenues were EUR 590 million, up 8% versus prior year, pre-provision profit was EUR 413 million, and the cost-income ratio was 31%. Risk costs were EUR 75 million, with a risk cost ratio of 54 basis points, and the NPL ratio was 90 basis points. On capital, the reported CET1 ratio was 17.4%, with management citing more than EUR 1 billion of excess capital and saying the group is fully funded for the PTSB deal. For 2026 excluding any PTSB impact, management reconfirmed net profit over EUR 960 million, ROTE over 20%, and a cost-income ratio under 33%; for the second half, they guided to around EUR 500 million net profit if CET1 stays above 12.5%.

Anas Abuzaakouk framed the quarter as evidence that BAWAG’s investments and operating model are continuing to pay off, calling the business “very strong” and emphasizing a fortress balance sheet. He highlighted the strategic importance of PTSB as a “pivotal step” in Ireland and said the company has spent months preparing for integration and regulatory engagement. His tone was confident and disciplined: management wants growth, but repeatedly stressed patience, underwriting discipline, and staying within capital guardrails.

Enver Siručić focused on capital, funding, and the drivers of earnings. He said CET1 ended at 17.4%, up from a 14.6% starting point at year-end, and that the group generated 285 bps in the first half through earnings, RWA measures, and a temporary dividend-policy change, leaving it fully funded for the transaction. On operations, he cited NII up 2% quarter over quarter, NCI up 3%, expenses down 2%, and a cost-income ratio of 31%; he also noted EUR 15 billion in cash, an LCR of 217%, and a 90 bps NPL ratio. He said the Q2 tax rate of 23.1% was unusually low because of the tax-free minority investment sale and should normalize, and he expects the full-year cost of risk to be around 50 bps.

Analysts focused on RWAs, SRTs, deposit competition, loan growth, risk costs, fees, and the PTSB deal. Management said the roughly EUR 1 billion RWA decline was mostly from the credit card SRT, with the P&L effect showing up mainly in NII for unsecured SRTs and partly in risk costs for other exposures. On deposits, they said core deposits were flat or slightly up, with some runoff in German online deposits and more competition in non-retail money markets and Austria’s Bundesschatz offer, but no meaningful pricing impact. Management also said loan growth was not being actively slowed for capital reasons; mortgage volumes remain muted while consumer, cards, and specialty finance are stronger, and they framed the higher risk-cost guidance as mostly an asset-mix effect rather than a pure macro call.