Investors can select from a wide range of banks to capitalize on their savings in this difficult year for the equity markets. One of these options is represented by a financial group of mid-cap as Bankia is at the moment and to which some financial analysts point to a high potential for revaluation in the short and medium term. Although of course it will not be a risk-free decision as you will be able to verify in this article.
Bankia obtained a attributed profit of 703 million euros in 2018, which represents an increase of 39,2% compared to 2017. In ordinary terms, the profit was 788 million, which represents a decrease of 3,4% compared to the 816 million earned in the previous exercise. These are results, which on the other hand, have not been well received by small and medium investors who have opted for massive sales in the equity markets. Although within a very bearish context in the financial markets and that can interpret this performance in the trading floors of national equities.
On the other hand, during the past financial year, Bankia increased by 5,5% the interest margin, up to 2.049 million euros (however, if BMN had been included in the income statement for 2017, this line would fall by 9,6%). This may be one of the reasons why these data have not been endorsed by investors. In a scenario that does not benefit the interests of the banking group in general. Not surprisingly, the falls during these days affect all banks, without exception of any kind. To the point that you can consider whether or not it is a good time to enter this value of Spanish equities.
Bankia quarterly profits
Goirigolzarri has also shown great confidence in the transformation of the entity in the year that has just started. “We enter 2019 with a new organization. An organization designed for the future, a much more agile and much more ambitious organization. And that, of course, is going to give us results in the short term, but also in the medium and long term ”. For his part, the CEO of the entity, José Sevilla, has valued that “throughout 2018 we have grown in the key segments of our business, such as consumer credit and business financing, in which we have increased formalizations and increased our market share ”.
Seville has underlined that a year is closing “very important in everything related to balance sheet health and the growth of our capital ratio, which will reach 12,51% when the transactions in progress are closed, which keeps us as one of the the most solvent entities in the sector ”. During 2018, Bankia increased its interest margin by 5,5%, to 2.049 million euros (however, if BMN had been included in the 2017 income statement, this line would fall by 9,6%). Commission income increased by 25,3% (3,4% in the homogeneous comparison) and the results from financial operations increased by 11,5%, which allowed the gross margin to increase by 11,3% (it falls by 6,3% with BMN) and stood at 3.368 million.
Dividend increase per share
With these results, the Board of Directors will propose to the General Shareholders' Meeting raise 5% the dividend per share, up to 11,576 cents (11,024 cents in 2017). Thus, the total amount that will be paid to Bankia shareholders will amount to 357 million euros, compared to 340 million in the previous year. The pay-out thus reaches 50%.
With the current 61,4% stake that the FROB has in Bankia, this dividend will represent a further advance in the process of repayment of aid amounting to 219 million euros. Thus, the total aid refunded after payment, which is expected in April, will amount to 3.083 million euros, of which 961 million correspond to the five dividends paid since 2014.
Granting of credits
On the other hand, and in terms of activity, mortgage formalizations grew by 6%, to 2.928 million euros; while those of consumer credit increased by 13%, to 2.286 million, and those of business financing they increased by 13%, to 14.484 million. Thus, the balance of consumer credit rose 14,1% and that of companies, 4,4%. Similarly, the bank made significant progress in the means of payment business.
The billing of the point of sale terminals (POS) grew 15,2%, and customer card payments in stores increased 12,8%. All of this translated into new growth in market shares, which stood at 12,39% in the case of POS terminals and 12% in card purchases.
On the resource side of retail customers, ended the year with a decrease of 0,3%, to 147.149 million euros. In this evolution, the performance of investment funds stood out, which, in a very difficult year for markets, increased their share by 17 basis points, to 6,55%.
With more clients
The bank increased the number of clients by 120.576 during the year and increased its loyalty, since at the end of the year it had 103.000 more clients with direct debit income.
In the customer base, there was also an increase in the digitization rateThus, at the end of the year, 45,4% of customers were digital and 25,8% of sales were made through this channel, compared to 15,7% the previous year. It should be noted that 31,4% of consumer credit concessions were made digitally, as was 19,4% of the contracting of pension plans or 12,6% of investment funds.
Within this general context, it is one of the financial groups that has had the best performance on the stock market in recent years. Above banks of special relevance, as for example in the cases of BBVA and Banco Santander. It cannot be forgotten, on the other hand, that this bank comes from a financial group with serious problems and that at the beginning it has caused a good part of the small and medium investors to have shown certain misgivings to open positions in this value of the selective income index Spanish variable.
Around 2,50 euros
The valuation in the prices of the bank is around 2,50 euros. Although in any case, one of its common denominators is its high volatility and that has led to large differences between its maximum and minimum prices in most of the trading sessions. In this sense, we cannot forget that just a few years ago the share price of this commercial bank was slightly more than one euro unit. This means in practice that your valuation has doubled in this period of time.
However, after the increases experienced in recent years there is no doubt that its upside potential it has been exhausted and it is already much more complicated that it can be revalued, at least as in previous years. But rather the opposite, that there are important corrections in their prices and that could be used to take positions at much more competitive prices than at the moment. Beyond other technical considerations and maybe also from the point of view of its fundamentals.
Leader in immediate transfers
Another of the most relevant aspects of this financial group comes from the fact that Bankia has led the business of immediate transfers during 2018, the first year of existence of this type of operations in the Spanish market, upon reaching a quota of 39% of the amount transferred. Likewise, the entity has led this business by number of operations, with 28% of the transfers carried out in Spain.
Since February 2018, the month in which the immediate transfer system began in our country, at the end of the year, the system transferred 16.800 million euros in more than 23,2 million operations, according to Iberpay data regarding operations carried out through the ASI4 service. Of these, Bankia carried out 6,6 million transfers for a combined amount of 6.500 million euros.
In any case, it is one of the values of the Spanish equity markets of which it will be necessary to be very attentive from now on. Because it can develop a new upward momentum that may take it to levels very close to three euros a share. It is something that of course cannot be ruled out in the medium and long term, depending on how the international financial markets evolve in the coming weeks.
The valuation in the prices of the bank is around 2,50 euros. Although in any case, one of its common denominators is its high volatility and that has led to large differences between its maximum and minimum prices in most of the trading sessions. In this sense, we cannot forget that just a few years ago the share price of this commercial bank was slightly more than one euro unit. This means in practice that your valuation has doubled in this period of time.