Published by Global Banking and Finance Review
Posted on July 29, 2025
By Jesús Aguado
MADRID (Reuters) -Spain's Unicaja on Tuesday forecast a gradual recovery in lending income in 2025 after a rise in fees also helped the lender beat profit forecasts in the second quarter.
The country's sixth-biggest bank said it expected net interest income -- a measure of earnings on loans minus deposit costs --, to finish this year above 1.45 billion euros from a previous guidance of above 1.4 billion euros.
This would still be a decline from 1.54 billion euros in 2024.
Spanish banks have benefited from higher costs of loans tied mostly to variable rates, but lower rates are squeezing margins.
Unicaja's net interest income, a measure of earnings on loans minus deposit costs, in the quarter fell 2.5% to 374 million euros against the same period a year ago but beat forecasts of 363 million euros.
Compared to the previous quarter, however, NII was up 1.5% thanks to lower deposit costs and a recovery in loans.
Madrid-based brokerage Renta 4 welcomed better margins and improved guidance for net interest income and commissions.
At 0721 GMT, Unicaja was the best performer in Spain's blue-chip index with a rise of over 5%, while the index itself was up 0.4%
Net profit in the quarter fell 2.4% to 179 million euros but was also above analysts' forecasts of 169 million euros despite booking 5 million euros against the renewed banking tax.
The profit beat was also helped by a rise of 3.5% in total fees in the quarter which it expected grow at a low single digit rate this year from a previously expected "flattish" performance as banks try to lift non-core banking revenues.
The bank's performing loan book was almost flat year-on-year in the quarter but rose 3.5% quarter-on-quarter.
In it its new strategy, Unicaja had vowed to increase its profit with a push into business and consumer lending.
New business lending in the April to June period rose 43% year-on-year while consumer lending was 40% up.
Unicaja also announced an interim dividend of 169 million euros against 2025 results, 10% higher than in 2024.
($1 = 0.8632 euros)
(Reporting by Jesús Aguado, editing by Inti Landauro and Giles Elgood)
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