CONSOLIDATED INCOME STATEMENT
Spanish banks obtained an attributable profit of €3.17 billion in the first quarter of 2021, compared to losses of €1.125 billion in the same period of the previous year.
The 8% year-on-year decrease in gross margin, to €19.277 billion, is primarily due to lower margins obtained from interest and commissions, only partially offset by better results, net of exchange differences, from financial operations.
Operating expenses decreased by more than 10% year-on-year, with the efficiency ratio improving by more than one percentage point to 46.4%, compared to 47.6% a year earlier.
Following the significant provisioning and allowance effort made in 2020 to anticipate the possible adverse effects of the crisis on the credit quality of their portfolios, Spanish banks maintain the effort in the first quarter of 2021, with a total of €4.8 billion, an amount equivalent to that recorded quarterly in 2019, before the onset of the pandemic.
The extraordinary write-downs undertaken additionally in the first months of 2020 caused losses in the income statement of €636 million as of March 31. At the end of the first quarter of 2021, consolidated results amounted to €3.762 billion in profit, representing a return on assets (ROA) of 0.55%, similar to the quarterly average for fiscal year 2019.
CONSOLIDATED BALANCE SHEET
The consolidated balance sheet stood at €2.75 trillion in total assets as of March 31, 2021, with growth of 2.3% compared to the same date in the previous year.
The evolution of balance sheet equity items over the last twelve months is primarily explained by three factors.
First, the monetary policy of central banks explains the increase of more than 50% year-on-year in balances, both assets and liabilities, held with said monetary authorities. Second, the evolution of equity items is explained by the significant reduction in trading activity, especially with derivatives, whose book value decreases by more than €50 billion, both in assets and liabilities.
Finally, the variation in customer loan and deposit figures is affected by agreements for the sale of a subsidiary, with the consequent reclassification of its balances to the non-current assets heading. Excluding this effect, moderate year-on-year credit growth can be estimated, instead of the 3.6% reduction shown in the balance sheet figures, and an increase in deposits greater than the 2.9% recorded.
Credit non-performing ratio stood at 3.7%, a level similar to that of the previous year, but with a coverage ratio that, following the provisions made in the previous year, is two percentage points higher and reaches 74%.
As a consequence of the losses recorded in 2020, net equity as of March 31, 2021 is 6% lower than twelve months earlier, although its balance continues the growth path initiated in the second half of the previous year and shows an increase of 1% compared to December 2020.
For its part, the CET1 capital ratio on a fully loaded basis (fully loaded) stood at 11.9% in March 2021, compared to 11.4% in March of the previous year.
