Lisbon, May 4, 2026 (Lusa) – Portugal's Banco Montepio consolidated profit fell 31% to €23.6 million in the first quarter compared to the same period last year, reflecting the "normalisation of the cost of risk", the bank announced in a statement on Monday.
"This figure compares with €34.2 million in the first quarter of 2025, reflecting the normalisation of the cost of risk following an extraordinary reversal of loan impairments recorded in early 2025 amounting to €12.3 million, with impairment levels remaining historically low in 2026," the bank detailed. Excluding this impact, net profit for the first three months of 2026 would have increased by 11%, reflecting the strengthening of the bank’s operational and recurring performance.
Highlighting the "acceleration of commercial activity in credit and deposits", Montepio considers that the performance until March confirms the successful execution of its current strategy. It said that 2025 marked its best-ever business growth and saw the institution reach investment grade status with international rating agencies Moody's, Fitch, and DBRS.
In the first quarter, banking income increased 4.4% year-on-year to €109.1 million, reflecting positive commercial activity, with net interest margin reaching €84.3 million.
According to Montepio, this banking income figure includes contributions to the banking sector totalling €9 million, recorded under "other negative operating results".
Net commissions rose to €34 million (+3.4%), supported by higher "insurance brokerage, market, and payment service commissions resulting from the expansion of commercial activity, as no material changes occurred to the fee schedule."
During the period, customer deposits reached a new record high of €16.3 billion, a 6.8% increase compared to the €1.033 billion in the first quarter of 2025. The private segment represented 68% of the total.
"The year-on-year growth of deposits was strongly driven by both segments, with private customers rising by €551 million (+5.2%) and the corporate segment increasing by €482 million (+10.2%), reflecting relevant commercial dynamics," Banco Montepio said.
Gross loans to customers rose 8.5% (€1.048 billion) to €13.4 billion, while performing loans grew by €1.092 billion (+9.1%) year-on-year.
Considering only the first quarter of 2026, gross loans to customers and deposits increased by 2.7% and 1.4%, respectively. Performing loans grew by 2.7% (€351 million) in the first quarter, reaching €13.2 billion.
Regarding asset quality indicators, Montepio reported a zero cost of credit risk, maintaining the level seen in 2025. The bank achieved a year-on-year reduction in non-performing exposures (NPE) of €44 million (-17.6%). This placed the NPE ratio (non-performing loans) at 1.6%, compared to 2.1% at the end of March 2025, falling below the Portuguese banking system average (2.1% at the end of 2025).
The NPE ratio net of total credit risk impairments stood at 0.2%, compared to 0.4% at the end of the same month in 2025. NPE coverage by specific impairments reached 50.9%, exceeding the European Union average of 41.4% at the end of 2025.
Total impairment coverage for credit risk rose to 85.9% (80.1% at the end of March 2025). This figure reached 109.5% when considering associated collateral and financial guarantees, compared to 120.6% in the same month of 2025.
Banco Montepio reported a year-on-year reduction of €58 million (-33%) in real estate risk exposure, totalling €118 million. This represents 0.6% of net assets (0.9% at the end of March 2025) and 7.2% of equity (11.3% at the end of March 2025).
Efficiency, measured by the recurring cost-to-income ratio, improved to 61.0% in the first quarter of this year, compared to 62.3% at the end of 2025.
The net value of total impairments and provisions reached €0.9 million in the first three months of 2026. This shows a higher net allocation of €11.3 million compared to the same period last year.
During this period, the Common Equity Tier 1 (CET1) ratio stood at 16.0% (-0.2 percentage points year-on-year), while the Total Capital ratio was 19.0% (-0.4 percentage points). The Minimum Requirement for Own Funds and Eligible Liabilities (MREL) ratio, as a percentage of total Risk-Weighted Assets (RWA), reached 26.0% (+1.0 percentage points).
The Liquidity Coverage Ratio (LCR) stood at 174.2%, while the Net Stable Funding Ratio (NSFR) reached 141.1%. The liquidity buffer rose to €5.8 billion (+1.4% year-on-year), reflecting a strengthened liquidity position.
Montepio's operating costs totalled €72.4 million in the first quarter of this year, up from €70.8 million in the same period last year. The bank said that this increase "reflects the rise in personnel costs and general administrative expenses associated with the inflation rate."
Personnel costs rose 2.4% to €40.8 million. The bank attributed this to "adjustments in the cost structure induced by inflation and the internal policy of valuing and retaining talent."
General administrative expenses reached €18.9 million, a 3.5% increase. This figure reflects the impact of inflation on the contracting and renewal of service agreements, particularly within the context of Banco Montepio's digital transformation and the development of its information systems.
PD/RYOL // AYLS
Lusa
