An economic climate which has remained unpredictabl

The year 2024 was marked by increased geopolitical tensions and instability. The conflicts in Ukraine and the Middle East accentuated the uncertainties on the financial markets. The elections in the United States and in Europe generated additional volatility, fuelling debates on the future stance of monetary and commercial policies.

Against this background, Banque Raiffeisen chose to rely on its core values: prudence, resilience and proximity. This approach has enabled it to operate with agility while pursuing its development objectives. Providing long-term support to its private, professional and institutional customers by offering them tailored solutions and personalised follow-up has therefore remained at the centre of the mission of the country’s leading cooperative bank.

Faced with this complex context, the Bank has continued to fulfil its role as a trusted financial partner, remaining faithful to its values as a cooperative bank and its commitments to responsible and sustainable finance. As of 31 December 2024, the Bank posted a net profit of €28.1 million, an increase of more than 10% compared with the ordinary net profit for 2023.

This result allows the Bank to consolidate its business model, strengthen its foundations and invest in the future with the objective of maintaining a relationship of trust and proximity with its customers, members, external partners and staff.

Sustained momentum which translates into an increase in sources of income

Financial investment activity continued to expand, in view of sustained momentum in both discretionary management and investment advice. In addition, the confidence shown by its customers throughout the year is also reflected in the increase in household savings and deposits.

This commercial momentum has resulted in a 3.6% increase in net banking income, which now exceeds €245 million, mainly driven by both interest and commission income.

At the same time, the Bank has continued to invest in its own future and in the relationship with its customers and staff members. This strategy has led to a 6.3% increase in operating costs, mainly due to the recruitment of around 20 new staff members, on whom the Bank relies to strengthen its development and meet regulatory requirements.

A real estate market that shows signs of stabilisation

During 2024, the Luxembourg real estate market displayed signs of stabilisation. The government measures put in place at the beginning of the year supported the sector, but the level of interest rates, combined with real estate prices in the country, continued to restrict access to credit despite the gradual decline in interest rates. Prices for existing houses and apartments stagnated after the marked correction of the previous year. The Luxembourg economy experienced moderate growth, driven by the dynamism of the financial sector and business services, although the rising cost of living and the slowdown in hiring in certain sectors weighed on consumer confidence.

Increase in savings from households and businesses

The trust placed in Banque Raiffeisen is reflected in the continuous increase in the number of customers and members, which now stands at over 50,000. That trust is also accompanied by an increase in savings and deposits.

On the liabilities side of the Bank’s balance sheet, funds entrusted by customers amount to €10,346.2 million, an increase of almost €750 million (or +7.8%) as the result of an increase in household savings by a total amount of €420 million (or +6.8%). Despite a more restrictive economic environment affecting the cash flow of professional customers, their savings also increased by €328 million (or +9.6%).

Regulatory capital increased by €62.5 million (or +8.1%) following the allocation of net profits to reserves and an allocation to the Fund for General Banking Risks of €40 million. This significant strengthening of equity capital enables the Bank to support the development of its business model and the growth of its activities while enhancing its resilience in the face of economic uncertainties.

Customer lending increased by 2.2%

On the assets side of the balance sheet, customer lending activity reached €7,860.4 million, increasing by €166 million (or +2.2%) over one year. This development is driven by the continuity of the support to the projects of companies, local authorities and para-public entities. This segment also shows an increase of 7.7%. At the same time, due to renewed interest from its households starting in the second half of 2024, outstanding loans related to the financing of access to home ownership stabilised after a historic decline in 2023.

Profit and loss account

By virtue of the strength of its business model and its rigorous management, Banque Raiffeisen is posting growing revenues while maintaining a prudent risk management policy.

At the end of the 2024 financial year, the Bank recorded a 1.7% increase in net interest income and a 4.5% increase in commission income compared with the previous financial year. Net banking income increased by 3.6% over one year.

Furthermore, operating costs, mainly impacted by the growth in staff costs, increased by 6.3%. Based on the volume of its customers’ deposits, the Bank also paid a contribution to the Luxembourg Deposit Guarantee Fund amounting to a total of €3 million.

The cost of risk also affects the Bank’s profit and loss account. In 2024, the Bank hedged against credit risks for a total amount of €17.4 million, a significant decrease compared to the €53.3 million recorded in 2023. A slight recovery in economic sentiment following the sharp decline of the previous year, combined with generally stable forecasts, enabled Banque Raiffeisen to cover all identified credit risks while maintaining a reserve to cover any contingent risks.

In the light of all these factors and after deduction of tax expenses, the Bank posted a result of €28.1 million, an increase of more than 10% compared to the ordinary net result of 2023.

Proximity and customer experience

Banque Raiffeisen provides a local service to its customers, drawing on its network of 28 branches and the secure and efficient digital solutions offered via the Online Branch.

In 2024, the Bank continued its policy of expanding its physical points of contact with the opening of new branches, such as the Esch-Belval branch and Luxembourg-Gare, the renovation of several others and the launch of the “Business Hub” in Esch/Alzette, in the wake of those in Leudelange and Ettelbruck. Particular emphasis has also been placed on digital transformation with a view to improving the customer experience, enhancing the security of online services and simplifying internal processes and the Bank is strongly committed to maintaining this focus in the future.

The staff commitment survey shows remarkable results

Banque Raiffeisen positions itself as a responsible employer, with a particular emphasis placed on the commitment and well-being of its staff members and offering an adequate work-life balance.

Professional fulfilment is at the heart of the Bank’s corporate culture. Within this context, Banque Raiffeisen conducted a large-scale internal survey in 2024 to assess the commitment of its staff members and to identify levers for motivation and retention. The results were extremely positive and show a strong adherence to the Bank’s values, particularly in terms of commitment, team spirit and collaboration, which are vital pillars of collective success.

Furthermore, the Bank continues to pay particular attention to training and the development of job-related skills, as well as to promoting staff loyalty and commitment, thus contributing to a more stimulating and dynamic work environment. Finally, the digitisation of the recruitment process offers genuine value added, by centralising and optimising the management of applications.

In 2024, Banque Raiffeisen also became the first company in Luxembourg to be awarded the “Positive Actions” label by the Ministry of Gender Equality and Diversity for the third time, thus demonstrating its commitment to diversity, equality and inclusion.

Solidity, reliability, responsibility, sustainability

The importance attached to sustainable finance continues to grow, and 2024 marked an acceleration of efforts in this direction. As a European financial hub, Luxembourg has continued its transition to a more sustainable economy, particularly in the field of ESG investment funds.

In line with this trend, European banks, including Banque Raiffeisen, have adapted their offerings. In order to better meet the expectations of its clients and investors who wish to contribute to the realisation of more responsible and sustainable growth, the Bank has developed financing solutions for positive impact investments and supported individuals and companies in the face of economic challenges. In the field of investments, the Bank ensures that it has a sustainable alternative integrating environmental, social and good governance criteria for each product and service offered.

Banque Raiffeisen has successfully combined development, resilience and prudence in terms of risk management. In line with its fundamental values which are an integral part of its DNA, the Bank remains a key player in the Luxembourg financial market and remains strongly committed to its customers, the national economy and to responsible and sustainable banking practices.

Looking ahead to 2025, the Bank remains resolutely forward-looking, driven by its values of proximity and trust, and determined to support its customers in the realisation of their long-term projects.

NB: The figures as reported in this Press Release are still subject to approval by the Ordinary General Meeting.

Press Release - By virtue of its balanced approach, Banque Raiffeisen closed the 2024 financial year with a current result that was up by 10% compared with the previous financial year