All quarterly accounts of Intesa Sanpaolo
What emerges from Intesa Sanpaolo's first 2021 quarterly report
Growing net profit, reduced non-performing loans, a solid balance sheet and a CEO ready to broaden the stock market for good, Frankfurt permitting, to remunerate shareholders. Despite the pandemic, Intesa Sanpaolo has something to celebrate for the results achieved in the first quarter of the current year. But let's see in detail.
HOW IS THE INCOME STATEMENT OF INTESA SANPAOLO
As we said, Ca 'de Sass in the first three months of the current year recorded a net profit of 1.52 billion euros, compared to 1.15 billion in the same period of 2020, a figure – reads the note released by the group – “fully in line with the goal of a net profit for the year well above 3.5 billion euro”. Net interest, equal to € 1.95 billion, was down by 4.3 on a trend basis, while net commissions increased by 8.9% compared to 2.11 billion in the first quarter of 2020, down by 0.5 % of those from commercial banking activities and growth of 12.6% of those from management, brokerage and consulting activities.
ALL THE FUNDAMENTAL NUMBERS OF INTESA SANPAOLO
A plus sign also for the insurance business at 373 million euros, compared to 372 million in the first quarter of 2020. Net operating income decreased, equal to 5.46 billion euros compared to 5,570 million in the same period last year, and operating costs, at 2.54 billion euros or -12.3% compared to 2.9 billion in the fourth quarter of 2020, thanks to -6.7% for personnel expenses, -26.9% for administrative expenses and -2.6% for depreciation. On the other hand, operating costs fell by 2.6% on a trend basis.
DIVIDENDS OF INTESA SANPAOLO
On the dividend policy front, in addition to the 694 million cash dividends for 2020 to be distributed in May 2021, Intesa Sanpaolo envisages – again following the indications of the ECB – based on the 2020 results, a cash distribution from reserves, possibly within the end of 2021, leading to the payment of an overall amount corresponding to a payout ratio equal to 75% of the 3,505 million euros of adjusted net profit. Also taken into account, based on the results of 2021, the payment of an amount of cash dividends corresponding to a payout ratio equal to 70% of the net profit, to be distributed in part as an advance payment in 2021. In this way, "the maintenance the solidity of the capital ratios, with a Common Equity Tier 1 ratio fully operational in 2021 at least 13% pro-forma (12% non-pro-forma) ".
THE BALANCE SHEET OF INTESA SANPAOLO
In the press release issued by the group, it is highlighted how the capitalization is “very solid”, with ratios on levels that are well above the regulatory requirements. In the first quarter of this year, by deducting € 1,061 million of accrued dividends from the capital, the Common Equity Tier 1 ratio calculated by applying the transitional criteria in force for 2021 was equal to 14.9%, the Common Equity Tier 1 ratio when fully operational at 14.4% and the pro-forma Common Equity Tier 1 ratio when fully operational at 15.7%, the highest level among the major European banks.
CHAPTER NON-PERFORMING LOANS
In terms of impaired loans, Intesa Sanpaolo reduced them, gross of value adjustments, by approximately 44 billion from the peak of September 2015 and by approximately 32 billion from December 2017, exceeding the target by approximately 6 billion one year in advance. reduction of 26 billion expected for the period 2018-2021, included in the Business Plan. Therefore, in March 2021 the stock of impaired loans decreased, compared to December 2020, by 0.8% gross of value adjustments and by 2.3% net; the incidence of impaired loans on total loans was equal to 4.4% gross of value adjustments and 2.3% net. Considering the methodology adopted by the EBA, the incidence of impaired loans gross of value adjustments was equal to 3.5%.
LOANS AND ACTIVITIES FOR BUSINESSES AND FAMILIES
In the first three months of 2021, Ca 'de Sass distributed approximately 23 billion euros of new medium / long-term credit, of which approximately 21 billion in Italy and approximately 18 billion to households and small and medium-sized enterprises. In addition, 2,900 Italian companies have been brought back from non-performing credit positions and about 126,000 since 2014, preserving respectively around 14,500 and 630,000 jobs. In addition, initiatives for the reduction of child poverty and support for people in difficulty must be recorded, for which approximately 17.7 million meals, 1.1 million beds, 244 thousand medicines and 203 thousand items of clothing have been provided since 2018. In the fourth quarter of 2018, the Impact Fund was also launched for the disbursement of approximately € 1.5 billion in loans to categories that would otherwise have difficulty accessing credit despite their potential; launched the first unsecured credit line dedicated to all Italian university students, who study in our country or abroad, with € 16.3 million disbursed in the first quarter of 2021 and approximately 107 million since its launch or at the beginning of 2019 .
THE COMMENT OF MESSINA
The CEO, Carlo Messina, is delighted with the results of his group. "The role of strong driver for the recovery of growth that Intesa Sanpaolo will be able to play is based on the levels of efficiency, profitability and solidity, which place us at the top of the sector in Europe", said the Roman banker, recalling that "the net result of the first quarter 2021 is equal to 1.5 billion euros, with an increase of 32% compared to the first quarter of 2020. The net operating income and the result from operations show a strong acceleration compared to the last quarter of last year (+ 9% and + 38%, respectively) ". Messina then looks at the Italian situation: "At this delicate moment for the country we are ready to be a reference point for sustainable and inclusive growth thanks to the over 400 billion medium and long-term loans that we will make available to businesses and families to support of the Pnrr. To get closer to the levels of employment highlighted by other large European countries – he continued – we must focus on the solid fundamentals of our economy: the high wealth of Italian families, equal to 10.700 billion euros, of which 4.400 represented by financial assets; our manufacturing companies, with much more solid balance sheets than the levels prior to the 2008 crisis; the excellence of our exports, able to exceed, in the last 5 years, the German one by more than 4 percentage points ”.
The CEO of Intesa Sanpaolo also spoke of the remuneration of shareholders which “remains a priority. In May – he explained – we will distribute about 700 million in cash dividends, the maximum amount established by the supervisor. Once the restrictions of the ECB have been overcome – he concluded – we intend to distribute in cash – from the reserves – the remaining part to reach the payout ratio envisaged in the Business Plan, equal to a total of 75% of 3.5 billion of normalized net profit 2020 " .
Messina was also satisfied with the integration process of Ubi which “ended perfectly in line with our plans”. “The key to success – he added – is the involvement of people from Ubi. The synergies deriving from the combination with Ubi Banca, expected at over 1 billion euros per year and higher than initial estimates, will add significant value to our European leadership position ". In general, however, all the employees of the group deserve the praise of the CEO: “Intesa Sanpaolo's ability to reach and exceed its objectives, even in a period of exceptional complexity, is due to the professional quality of its people. My personal thanks go to them: in a period of extraordinary difficulty, the integration of Ubi was successfully completed and we have achieved significantly positive results – he concluded -. Thanks to them and to the important goals achieved, our Bank will continue in its role as an engine at the service of inclusive and sustainable growth ”.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/tutti-i-conti-trimestrali-di-intesa-sanpaolo/ on Wed, 05 May 2021 13:09:32 +0000.