CaixaBank First-Quarter Profit Doubles Amid Higher Fees

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Spain’s CaixaBank SA, which is bidding for a Portuguese lender, said profit doubled in the first quarter as investment banking and asset management fees increased.

Net income rose to 375 million euros ($401 million) from 188 million euros a year earlier, the Barcelona-based lender said in a filing to regulators Thursday. Profit beat the 364.8 million-euro average estimate in a Bloomberg survey of eight analysts.

Chief Executive Officer Gonzalo Gortazar has set out plans to boost profitability four-fold by 2017 by controlling costs and expanding earnings while taking advantage of the pickup in the country’s economy.

“The results show an important operational improvement and also present a significant progress in earnings,” Gortazar said in a presentation in Barcelona on Thursday. “I think this is a good first step in the long journey we face in the next years to achieve our goals of the strategic plan.”

The bank has offered 1.1 billion euros to buy out the 56 percent of Portugal’s Banco BPI SA that it doesn’t own. Gortazar said Thursday the bank is waiting for regulatory approval to continue with the offer and that it is a positive offer for BPI shareholders. CaixaBank is offering 1.329 euros in cash per share.

CaixaBank gained 1.4 percent to 4.33 euros as of 11:15 a.m. in Madrid, trimming the year’s losses to 0.7 percent. The STOXX 600 Banks Index has gained 15 percent this year.

Barclays Effect

CaixaBank bought Barclays Plc’s banking operations in Spain last year.

“This is an atypical quarter for CaixaBank due to the impact of Barclays in the results,” Daragh Quinn, an analyst with Nomura Holdings Inc. in Madrid, said by phone. “Capital levels and credit quality fell with the incorporation of Barclays but remain at an adequate level.”

The Barcelona-based lender has gained 4,100 new private banking clients from Barclays Spain and 17.7 billion euros in loans. Total commissions at the bank increased 13 percent from a year earlier to 513 million euros, a record high, Gortazar said.

Bad loans as a proportion of total lending at CaixaBank remained unchanged at 9.7 percent from end of December, the bank said. Net interest income, or the difference between what a bank charges for loans and pays for funding, increased to 1.14 billion euros from 1.08 billion euros the previous quarter.

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