Unicaja Banco S.A.

Reported numbers were generally positive. H1 2026 net profit was EUR 361 million, up 7% year over year, and Q2 net profit was EUR 201 million, up 12% year over year and 25% sequentially. Q2 gross margin rose 8.5%, pre-provision profit rose nearly 15%, and H1 revenues rose 2.5%; costs rose at a mid-single-digit pace, and provisions fell, with loan provisions down nearly 25% in H1 and Q2 loan provisions at EUR 23 million versus EUR 32 million a year ago. Credit metrics improved further, with the NPL ratio at 1.8%, NPL coverage at 83% versus 73% a year ago, and cost of risk at 18 bps in Q2. CET1 stood at 15.8%, and management said the first interim dividend will be EUR 217 million, equal to EUR 8.44 per share, paid on 24 September. For the full year, Unicaja expects net interest income to rise between low and mid-single digits, fees to grow low single digits, costs to rise mid-single digits, cost of risk to end at 20-25 bps, business volume to grow around 3%, and net profit to grow in mid-single digits.

The CEO framed the quarter as evidence that the strategic plan is starting to work: investments in talent, processes, and technology are lifting business momentum now while also building the longer term franchise. He emphasized stronger customer acquisition through payroll accounts and mortgages, better digital and AI capabilities, and growing leadership in mutual funds and other off-balance-sheet products. Tone-wise, he was upbeat but still disciplined, repeatedly saying the bank is satisfied yet still has room to improve.

The CFO focused on the mechanics behind the quarter’s profitability: 2% Q/Q net interest income growth, 8.5% higher gross margin, nearly 15% higher pre-provision profit, and lower provisioning that helped deliver EUR 201 million in quarterly net income. He pointed to deposits shifting toward demand balances, off-balance-sheet funds up 12.7% year over year, mutual funds above EUR 18 billion, and new lending production of EUR 5.515 billion in H1. On capital and liquidity, he cited CET1 at 15.8%, an MREL ratio of 27% after two issuances, and liquidity coverage above 300%, while noting the bank is keeping costs in line with its strategic investments and expects stable-to-improving margin trends as repricing continues.

Analysts pressed on 2027 margin/NII sensitivity, deposit competition, customer profitability, public-sector deposit seasonality, front-book versus back-book yields, corporate growth, DTA deductions, buybacks versus cash dividends, M&A, and the Wink card business. Management repeatedly declined to provide 2027 guidance, saying it is too early because of rate volatility, but said the NII trend should remain positive on repricing and higher volumes; they also said the cost of risk outlook is prudent because geopolitical and macro risks remain. On capital returns, management said it chose cash dividends for the extra payout and expects 95% of 2026 earnings to be paid in cash, while on M&A they saw no near- or mid-term catalysts in Spain. They also said the real estate gains line should be immaterial going forward and that equity-method income should be relatively stable apart from a seasonal Q2 uplift.