Profit and loss account of credit institutions as at 31 March 2023
Press release 23/11
Profit before provisions and taxes of the Luxembourg banking sector1 amounted to EUR 2,024.9 million for the first quarter of 2023, i.e. a substantial increase of 56.8% compared to the same period of the previous year.
Profit and loss account as at 31 March 2023
| Items in million EUR |
January – March 2022 |
January – March 2023 |
Variation in % |
| Net interest income |
1,392.5 |
2,319.1 |
66.5% |
| Net fee and commission income |
1,591.4 |
1,498.0 |
-5.9% |
| Other net income |
357.9 |
405.3 |
13.2% |
| Banking income |
3,341.9 |
4,222.5 |
26.3% |
| Staff costs |
822.5 |
873.7 |
6.2% |
| Other general expenses |
1,228.1 |
1,323.9 |
7.8% |
| General expenses |
2,050.6 |
2,197.6 |
7.2% |
| Profit before provisions and taxes |
1,291.3 |
2,024.9 |
56.8% |
In the first quarter of 2023, net interest income recorded an increase of 66.5% compared to the same period of 2022. This trend which was recorded in 80% of the banks is attributable to the general rise in interest rates.
Net fee and commission income decreased by 5.9% year-on-year. The decline concerned more specifically banks providing wealth management services for private and institutional customers, including investment funds.
Other net income, which includes different elements that are by nature very volatile and generally non-recurring, rose by 13.2%.
General expenses (+7.2%) continued their upward trend for 72% of the banks. This rise concerned other general expenses (+7.8%) as well as staff costs (+6.2%).
The above-mentioned developments led to an average cost-to-income ratio amounting to 52%, against 61% in the first quarter of 2022. As at 31 March 2023, 23 out of 120 banks recorded a cost-to-income ratio higher than 100%.
1 The scope of the data of the Luxembourg banking sector covers banks active during the reference period, except for their foreign branches and their subsidiaries.