Spain’s Unicaja raises its 2024 profitability target to more than 8%

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MADRID, December 10 (Reuters)Unicaja from Spain UNI.MC announced Friday that it had raised its target for return on tangible equity (ROTE) for 2024 to more than 8%, against an estimated ROTE of 2.5%. in 2021 thank you to cost savings and a boost in consumer and business loans with stable fees.

The lender calculated the profitability target on the basis of an excess solvency threshold of 12.5% ​​in 2024 after a capital generation of 1.5 billion euros (1.69 billion dollars).

Under pressure from low interest rates and the fallout from the pandemic, European banks are taking various measures to cut costs, including pursuing mergers, such as Unicaja’s acquisition of Liberbank.

As part of their strategy to offset the pressure of low interest rates, they are also pushing into other areas of growth, such as insurance or asset management.

Last week Unicaja reached an agreement with unions to cut up to 1,513 jobs following the acquisition of Liberbank, resulting in annual cost savings of 97 million euros which is part of a target of cost synergy of 210 million euros per year by 2023.

($ 1 = € 0.8858)

(Reporting by Jesús Aguado; editing by Inti Landauro)

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