Profit and loss account of credit institutions as at 31 March 2023
The result before provisions and taxes of the Luxembourg banking sector1 amounts to 2,024.9 million EUR for the first quarter of 2023, which represents a substantial increase of 56.8% compared to the same period of the year. 'last year.
Profit and loss account as of March 31, 2023
| Items in millions of EUR | January – March 2022 | January – March 2023 | Variation % |
| Interest margin | 1.392,5 | 2.319,1 | 66,5% |
| Net commission income | 1.591,4 | 1.498,0 | -5,9% |
| Other net income | 357,9 | 405,3 | 13,2% |
| Net banking income | 3.341,9 | 4.222,5 | 26,3% |
| Personnel costs | 822,5 | 873,7 | 6,2% |
| Other overheads | 1.228,1 | 1.323,9 | 7,8% |
| Overheads | 2.050,6 | 2.197,6 | 7,2% |
| Earnings before provisions and taxes | 1.291,3 | 2.024,9 | 56,8% |
In the first quarter of 2023, the interest margin increased by 66.5% compared to the same period of 2022. This trend, which is observed for 80% of banks, is explained by the generalized rise in interest rates.
Net commission income fell by 5.9% year-on-year. The decrease particularly concerns banks that provide services related to wealth management for private and institutional clients, including investment funds.
Other net income, comprising miscellaneous items which are very volatile in nature and generally non-recurring, increased by 13.2%.
Overheads (+7.2%) remain on the rise for 72% of banks. This increase concerns both other overheads (+7.8%) and personnel costs (+6.2%).
The aforementioned developments lead to a cost-to-income ratio which stood at 52% compared to 61% in the first quarter of 2022. As of March 31, 2023, 23 banks out of 120 had a cost-to-income ratio above 100%.
1.Luxembourg banking sector data covers banks active during the reference period, excluding their foreign branches and subsidiaries.
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