BIL Reports Strong 2023 Profit Despite Slight Decline in Client Deposits

Banque Internationale à Luxembourg (BIL) reported a net profit of 202 million euros in 2023, a 32% increase from the previous year, driven by solid revenue growth despite an increase in expenses and cost of risk. The bank's net operating income before tax reached 239 million euros, up 88% from 2022.

However, customer deposits stood at 18.5 billion euros, slightly lower than 2022, mainly due to clients moving their deposits to higher return investments and early repayment of variable rate loans amid rising interest rates. Customer loans remained stable at 16.3 billion euros, with a slowdown in mortgage loan production in Luxembourg and early mortgage loan repayments.

Assets under management amounted to 43.8 billion euros, up by 0.7% compared to 2022. BIL showcased sound asset quality and strong capital and liquidity indicators, with a CET1 ratio of 14.41% and a Liquidity Coverage Ratio of 174%.

Why this matters: BIL's strong financial performance in 2023 demonstrates the bank's resilience and effective risk management strategies in the face of macroeconomic challenges. The bank's ability to maintain profitability and stable lending activity, despite a slight decline in customer deposits, highlights its adaptability to changing market conditions.

BIL CEO Marcel Leyers stated, "The 2023 performance confirms the relevance of BIL's strategic choices and its commitment to serving its clients." The bank noted that 2023 was a complex year due to geopolitical challenges, macroeconomic events, and the bank's own development, with the economy losing momentum after a robust post-pandemic expansion in 2021 and 2022.

In 2024, BIL's focus will be on fostering robust client relationships, reaching a higher level of service quality, and adapting its value proposition to clients' needs, while continuing to implement its 2020-2025 strategic plan.

Key Takeaways

• BIL reported a net profit of €202M in 2023, up 32% from 2022.
• Net operating income before tax reached €239M, up 88% from 2022.
• Customer deposits declined slightly to €18.5B, while loans remained stable at €16.3B.
• Assets under management grew 0.7% to €43.8B, with sound asset quality and capital ratios.
• BIL aims to foster client relationships, improve service, and adapt its value proposition in 2024.