First group in the first quarter: profit sinks, but forecasts remain positive!

First group in the first quarter: profit sinks, but forecasts remain positive!

In the first quarter of 2025, the first group recorded a decline in profit by 5.1 % to 743 million euros compared to the previous year. This development is due, among other things, to high bank taxes and significant degrees in collective contracts. Despite the decline, the interest surplus remained stable and rose by 1.1 % to 1.87 billion euros, especially driven by positive developments in Romania, the Czech Republic and Slovakia. The commission surplus even increased by 9.5 % to 780 million euros, which indicates growth in all core markets, especially in payment transactions and in asset management.

The risk costs of the company sank, and this led to a decline in payment defaults in Austria. This is also reflected in an improved NPL quota (share of lazy loans), which is now 2.5 %. However, the cost-to-income ratio increased from 46 % to 48 %. Personnel expenses in particular rose by 6.4 % to 794 million euros, which is due to the collective wage increase. The first Group currently employs 45,856 people, an increase of 0.3 % since the end of 2024.

bank taxes and future distributions

A major cost factor was the bank taxes, which were a total of 136 million euros in four core markets. The breakdown shows the burdens that are distributed as follows: 78 million euros in Hungary, 34 million euros in Austria, 10 million euros in Romania and 15 million euros in Slovakia. For the upcoming period, the first Group is planning distributions in the form of a dividend of 3 euros per share and a share buyback over 700 million euros.

Bank boss Peter Bosek also announced that the distributions from 2026 should be significantly increased, provided there are no value -adding acquisition options. The hard core capital ratio is significantly above the target value of 14 %, which is a positive indicator of the stability of the bank.

market developments and perspectives

In the context of the European banking landscape, an analysis by Bain & Company states that banks have been struggling with low equity returns since the global financial crisis in 2008/2009. Since the interest turn of the European Central Bank (ECB) in 2022, however, the return on equity has almost doubled and is currently showing 6.1 %. Such values were last achieved in the 1990s and 2000s.

For further details and a comprehensive insight into the location of the banking industry, the reports of vienna.at and Bain & Company .