General Bank closed the first nine months of 2024 with a consolidated net profit of 338,6 million euros, marking a growth of 33% compared to the same period of the previous year and beating analysts' forecasts, which estimated a profit of 335 million. The result was achieved thanks to a favorable context on the stock and bond markets, in which the bank was able to fully exploit its flexible and diversified Wealth Management model.
Recurring profit rose 2,7% from last year's already excellent level to €256,7 million, while the variable component amounted to €81,9 million.
As far as the third quarter 2024, profit increased by 23,7%, reaching 99,1 million and exceeding estimates of 95,5 million. The intermediation margin grew by 16,4%, reaching 229,1 million, thanks to the increase in recurring net commissions (+4,6%) and the stability of the financial margin (+1,9%). Variable commissions reached 28,2 million, compared to 2,7 million in the same period of 2023, supported by the good performance of the financial markets.
Banca Generali: collections and assets under management increase
Le masses managed and managed by Banca Generali on behalf of customers have exceeded the threshold of 100 billion euros, reaching 101 billion, with an increase of 14% compared to the previous year. In the nine months, the collection flows saw a 9% increase, totaling €4,7 billion. The recovery in demand for managed solutions contributed significantly to these results, highlighting the added value of the bank in meeting the investment needs of customers.
The intermediation margin increased by 22,8%, reaching 723,4 million euros, thanks to the contribution of both the financial margin, which grew by 2,9% to 247,9 million, and recurring net commissions, which increased by 4,6% to 353,3 million. The interest margin rose by 4,1%, reaching 237,3 million, supported by a context of high interest rates.
Banca Generali: the solidity of its capital base
As of September 30, 2024, Banca Generali confirmed the own financial strength with a CET1 ratio of 22,6% and a Total Capital ratio of 25,2%, taking into account the €1 million AT50 bond that will be repaid by the end of the year. The bank reaffirmed its ability to meet or exceed the financial targets set in the 2022-2024 three-year plan, which includes cumulative net inflows of between €18 billion and €22 billion and average annual growth in recurring earnings of between 10 and 15%.
Life insurance collections on the rise
During 2024, Banca Generali continued to expand its network of financial advisors, adding over 140 new bankers, bringing the total to more than 2.350 at the end of October. This network development was accompanied by a Recovery of collections in life insurance policies, with over 300 million raised in October alone, an amount that exceeds the total achieved in the previous nine months thanks to the new platform launched at the end of September.
Operation Intermonte: A Strategic Step
The CEO of Banca Generali, Gian Maria Mossa, announced that the bank is awaiting approval from the authorities for theVoluntary takeover bid for Intermonte, expected by the end of January 2025. “Intermonte, explains Mossa, “is a game changer and will lead to growth in brokerage activities e market-making, products offered in particular on derivatives and investment banking“. The operation, Mossa underlines “will not have an impact on the dividend policy".
The bank plans to exploit the synergies arising from the acquisition to increase trading activities and enrich the offering with consultancy on derivatives and structured products, also through Intermonte's Websim digital platform.
Banca Generali is therefore "confident in offering a return on investment higher than Banca Generali's cost of capital, thus confirming the ability to create extra value for its shareholders, and expects that the dividend policy will remain unchanged, given that the high capital ratios will easily absorb the capital requirements induced by Intermonte”.
Answering a question from an analyst, the CEO of Banca Generali defined theBanco Bpm's takeover bid for Anima a “good opportunity,” a financially sensible and quality operation. As for other possible operations in the sector, Mossa explained that this business is “volume-based” and will continue to gain momentum. “More operations are welcome,” Mossa concluded.
Guidance confirmed but earnings slightly lower
Looking ahead to the fourth quarter, Banca Generali expects to close the year with a net profit between 75 and 77 million euros, slightly lower compared to the third quarter, but maintaining a financial margin of between 323 and 325 million for the whole of 2024. Regarding 2025, Mossa confirmed that further details on the objectives will be provided during the presentation of the new industrial plan.
Banca Generali stock rallying
In light of the results, the response on the stock exchange was decidedly positive: the Banca Generali title marks a rise of more than 4%, with shares trading at over 42 euros.
