Profit attributable to the Group in 2014 came to €620 million, driven by growth in revenues, streamlined costs and lower NPL provisions.
Strong capacity for core income generation in the banking business
- Net interest income came in at €4,155 million (+5.1% vs 2013). This performance was bolstered by lower financing costs.
- Growth in fee and commission income (€1,825 million, +3.7% vs 2013). The increase can be put down to the growth in mutual fund assets under management, the rise in insurance sales and a closer management of pension funds.
- Income from equity investments stood at €491 million, +10.2% vs 2013.
- Gains on financial assets and foreign exchange differences totalled €640 million, reflecting market activity and the Group's management of its financial assets and liabilities.
- In 2013, "Other operating income and expenses" were impacted by higher contributions to the Deposit Guarantee Fund, essentially due to the extraordinary contribution sought from all banks in the year.
Reducing costs and unlocking synergies
- The effort to contain and streamline costs and to unlock synergies led to a 4.4% decrease in recurring operating expenses.
- In 2013, total extraordinary costs, primarily associated with the CaixaBank staff restructuring plan, came to €839 million.
- The recurring cost-to-income ratio fell 5.1 percentage points to 54.4%.
- Recurring pre-impairment income amounted to €3,167 million (+18.0%).
Reduction in cost of risk and impact of corporate operations
- Significant reduction in insolvency and other allowances: 40.5%. This reduction was underpinned by the enhanced quality of the loan book in 2014, sustained by a healthier economic climate. In addition, 2013 figures were affected by non-recurring impacts: primarily, recognition of €902 million to fully comply with the provisioning requirements set out in Royal Decree Law 18/2012 in relation to real estate developer risk.
- 86 bp reduction in the cost of risk, to 1.00%.
- Gains/(losses) on disposal of assets and others was shaped by non-recurring impacts in 2013, including the negative goodwill of Banco de Valencia and other gains secured on M&A transactions.