APS Bank plc – Interim Results
Following last week's article detailing the performance of the S&P 500 index in 2025, it is worth devoting time to review the developments across the European equity markers in my last article of the year.
Financial Performance
On 30 July 2026, APS Bank plc published its interim financial statements covering the six-month period ended 30 June 2026.
Net interest income surged by 43% to €51.0 million (H1 2025: €35.6 million) reflecting both the growth in gross interest income of 12.8% to €67.8 million as well as the 31% drop in interest expenses to €16.8 million. In this respect, APS explained that the higher interest income is attributable to the continued growth of its core retail and commercial lending portfolios as well as a significant increase in treasury portfolio yield, which more than offset the lower returns generated from syndicated loans as these facilities repriced at lower interest rates. Meanwhile, the reduction in interest costs reflects the continued shift towards overnight and on demand balances. As a result, the net interest margin strengthened to 2.23% compared to 1.72% in H1 2025.
Furthermore, non-interest income expanded by 49% to €7.7 million (H1 2025: €5.1 million) largely driven by the 33% increase in net fee and commission income to €6.1 million, reflecting all-round growth in banking and investment services income. The performance was also boosted by net gains on foreign exchange of €0.73 million in contrast to losses of €0.53 million in the same period last year.
Meanwhile, APS recorded a net impairment loss of €2.5 million, which is higher than the €0.45 million recognised in the first half of 2025 and primarily relates to the commercial and syndicated loan portfolios. Nonetheless, APS highlighted that the non-performing loans ratio as at the end of June 2026 stood at 1.44% compared to 1.42% as at the end of June 2025, which still attests to the credit quality of the loan book and the high underwriting standards adopted by the Bank.
Overall, net operating income surged by 39% to €56.2 million compared to €40.3 million in the corresponding period last year.
On the expenditure side, total operating costs increased by 4.0% to €32.8 million (H1 2025: €31.6 million) as the growth in employee compensation of €1.6 million was partly offset by a reduction in administrative expenses. In fact, APS noted that the comparative period included €1.3 million in non-recurring due-diligence and advisory costs relating the abandoned acquisition of HSBC Bank Malta plc. Since the growth in income outweighed the higher costs, the cost efficiency ratio improved considerably to 55.9% compared to 77.4% in H1 2025.
Moreover, APS also recorded a profit of €0.50 million from its share of results of associates, which is higher than the €0.39 million recorded in the first half of 2025.
Profit before tax more than doubled to a record at interim stage of €23.9 million compared to €9.14 million in H1 2025. After accounting for a tax charge of €7.62 million and minimal profit attributable to non-controlling interests, the profit for the period attributable to shareholders amounted to €16.1 million (H1 2025: €4.87 million), which translates into an annualised return on equity of 9.2% (H1 2025: 3.3%).
The Statement of Financial Position as at 30 June 2026, when compared to the end of 2025, shows that total assets increased by 3.2% (or €151 million) to €4.80 billion principally composed of customer loans which increased by 7.5% (or €253 million) to €3.63 billion. In contrast, cash and balances with the Central Bank of Malta contracted by 34.3% (or €137 million) to €264 million, which APS attributed to the efficient deployment of surplus liquidity into interest-bearing securities.
Total liabilities expanded by 3.3% (or €142 million) to €4.42 billion largely reflecting the 2.6% (or €108 million) increase in customer deposits to €4.24 billion. Consequently, the loan-to-deposit ratio (including syndicated loans) increased to 89.9% compared to 85.9% as at the end of 2025. Similarly, shareholders’ funds increased by 2.7% to €359 million which translates into a net asset value of €0.734 per share.
As at 30 June 2026, the CET 1 ratio stood at 16.6% (31 December 2025: 17.6%) and the Capital Adequacy Ratio at 21.5% (31 December 2025: 23.2%).
Dividend
The Board of Directors declared a net interim dividend of €4.0 million (H1 2025: €1.8 million), which is equivalent to €0.0082 per share and represents a payout ratio of 25%. This dividend in the form of scrip is payable to all shareholders as at close of trading on Tuesday 18 August 2026. The attribution price for the determination of the scrip dividend will be announced on 20 August 2026 and the payment date is set for 30 September 2026.
Outlook
Looking ahead, the Directors explained that APS is well placed to ride on the tailwinds of a strong first half of the year thanks to its efficient balance sheet management and resilient business model. APS remains focused on strengthening the customer experience, enhancing its digital capabilities and broadening its product and service offering, while preserving a disciplined approach to risk, capital and liquidity. The Directors added that the strategic decisions taken in recent years, making APS increasingly the ‘everyday bank of choice’, have resulted in higher customer engagement, greater business activity, deeper relationships and expanding banking and non-banking revenue streams.
The article contains public information only and is published solely for informational purposes. It should not be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. No representation or warranty, either expressed or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein, nor is it intended to be a complete statement or summary of the securities, markets or developments referred to in this article. Rizzo, Farrugia & Co. (Stockbrokers) Ltd (“Rizzo Farrugia”) is under no obligation to update or keep current the information contained herein. Since the buying and selling of securities by any person is dependent on that person’s financial situation and an assessment of the suitability and appropriateness of the proposed transaction, no person should act upon any recommendation in this article without first obtaining investment advice. Rizzo Farrugia, its directors, the author of this article, other employees or clients may have or have had interests in the securities referred to herein and may at any time make purchases and/or sales in them as principal or agent. Furthermore, Rizzo Farrugia may have or have had a relationship with or may provide or has provided other services of a corporate nature to companies herein mentioned. Stock markets are volatile and subject to fluctuations which cannot be reasonably foreseen. Past performance is not necessarily indicative of future results. Foreign currency rates of exchange may adversely affect the value, price or income of any security mentioned in this article. Neither Rizzo Farrugia, nor any of its directors or employees accepts any liability for any loss or damage arising out of the use of all or any part of this article. Additional information can be made available upon request from Rizzo, Farrugia & Co. (Stockbrokers) Ltd., Airways House, Fourth Floor, High Street, Sliema SLM 1551. Telephone: +356 2258 3000; Email: info@rizzofarrugia.com; Website: www.rizzofarrugia.com © 2021 Rizzo, Farrugia & Co. (Stockbrokers) Ltd. All rights reserved. This article may not be reproduced or redistributed, in whole or in part, without the written permission of Rizzo Farrugia. Moreover, Rizzo Farrugia accepts no liability whatsoever for the actions of third parties in this respect.
This article was produced by Edward Rizzo, Director at Rizzo Farrugia, which is a company licensed to undertake investment services in Malta by the MFSA under the Investment Services Act, Cap. 370 of the Laws of Malta and a member of the Malta Stock Exchange. The company’s registered address is at Airways House, Fourth Floor, High Street, Sliema SLM 1551, Malta.
The article contains public information only and is published solely for informational purposes. It should not be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. No representation or warranty, either expressed or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein, nor is it intended to be a complete statement or summary of the securities, markets or developments referred to in this article. Rizzo, Farrugia & Co. (Stockbrokers) Ltd (“Rizzo Farrugia”) is under no obligation to update or keep current the information contained herein. Since the buying and selling of securities by any person is dependent on that person’s financial situation and an assessment of the suitability and appropriateness of the proposed transaction, no person should act upon any recommendation in this article without first obtaining investment advice. Rizzo Farrugia, its directors, the author of this article, other employees or clients may have or have had interests in the securities referred to herein and may at any time make purchases and/or sales in them as principal or agent. Furthermore, Rizzo Farrugia may have or have had a relationship with or may provide or has provided other services of a corporate nature to companies herein mentioned. Stock markets are volatile and subject to fluctuations which cannot be reasonably foreseen. Past performance is not necessarily indicative of future results. Foreign currency rates of exchange may adversely affect the value, price or income of any security mentioned in this article. Neither Rizzo Farrugia, nor any of its directors or employees accepts any liability for any loss or damage arising out of the use of all or any part of this article. Additional information can be made available upon request from Rizzo, Farrugia & Co. (Stockbrokers) Ltd., Airways House, Fourth Floor, High Street, Sliema SLM 1551. Telephone: +356 2258 3000; Email: info@rizzofarrugia.com; Website: www.rizzofarrugia.com © 2021 Rizzo, Farrugia & Co. (Stockbrokers) Ltd. All rights reserved. This article may not be reproduced or redistributed, in whole or in part, without the written permission of Rizzo Farrugia. Moreover, Rizzo Farrugia accepts no liability whatsoever for the actions of third parties in this respect.
This article was produced by Edward Rizzo, Director at Rizzo Farrugia, which is a company licensed to undertake investment services in Malta by the MFSA under the Investment Services Act, Cap. 370 of the Laws of Malta and a member of the Malta Stock Exchange. The company’s registered address is at Airways House, Fourth Floor, High Street, Sliema SLM 1551, Malta.