Bankinter Consumer Finance

Bankinter Consumer Finance: the challenge of internationalisation

The inclusion of Irish
company Avantcard, which
has great potential, was
one of the highlights of the
year.
The loan book stood at
2,411 million euros and the
contribution to Group gross
operating income increased
to 13%.Bankinter Consumer Finance, the business line specialising in consumer loans, continued to grow at a sharp pace in 2019. This is one of the Group's key strategic areas, as its high margins are a positive exception in a scenario in which interest rates are close to zero, and where lending has doubled in the last four years. It has also benefitted from the increase in consumption in the Spanish economy but has held out against the gradual slowdown in GDP growth.

During the year, activity was focused on consumer loans, which rose by 44%, to 1,352 million, thanks largely to the effort made to increase their popularity through preapproved transactions. In the cards segment (both those paid at the end of the month and revolving loans) the performance was more contained, boosted by the alliances forged with different business groups.

In 2019, work was also carried out the improve the usability of the website, to make funds easily available. As a result, 89% of consumer loans were arranged online. Innovative projects were also launched such as the Combo card with two sides that can be used for different types of payment.

Another development in the year, which boosts the Group's internationalisation plan, was the acquisition of Avantcard, the Irish subsidiary of EVO Banco, dedicated to consumer finance on 31 May. Avantcard is actively used in the Irish market (lending of 466 million euros in 2019, +23%), is already turning a profit and provides a great opportunity to export Bankinter's know how. In the international arena, it was also an excellent year for the business in Portugal, where the loans and cards strategy was replicated.

As a result of this work, Bankinter's Consumer Finance figures performed very well. The customer portfolio reached 1.4 million euros, +8% vs. 2018; with 917 million euros of new loans, up 45%, and a loan book of 2,411 million euros, an increase 21% from 2018. Its contribution to gross operating income increased to 13%, from 11% in 2018.

The targets for 2020 are to strengthen the role of consumer loans as a key vehicle for customers, focusing on preapproved loans, sign new agreements and alliances for the cards business, and expand the internationalisation strategy. Bankinter Consumer Finance has far-reaching plans to expand the activities of Avantcard in the Irish market and to consolidate its business in Portugal.

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