Banca Carige foresees “a return to a positive economic result in 2018” and aims to “completely” meet the ECB's targets “as early as the end of 2017”. These are two of the eight points of the new 2017-2020 industrial plan called "Transformation program Carige" approved yesterday by the institute's board of directors. At the opening in Piazza Affari, investors rewarded the Bank's stock with a +4,5%, which was then reduced to +3,3%.
Also included in the new plan of the institute are a capital strengthening by over one billion euros, a 54% reduction in the stock of problem credits at the end of 2018 and by 58% in 2020, a significant cut of employees (from 4.742 to 3.900) and branches (from 518 to 455) within the next three years, a 23% reduction in operating costs and a 48% strengthening of the productivity business in 2020.
The ECB had indicated for Carige a minimum threshold of 9% as the minimum Cet1 target to be met from 2017 and 11,25% as the recommended threshold which also includes the so-called "second pillar" (Pillar 2 Capital Guidance).
The institute confirms the actions for capital strengthening to be carried out by 2017 through a capital increase up to 560 million, the optimization of liabilities through the conversion of bonds and the sale of assets (property, consumer credit, merchant book and npl platform).
As for the non-performing loans, the actions will aim at an "active management" that aims "to reduce volumes and increase coverage in line with best practices".
The targets indicated by the ECB with regard to non-performing loans were of a maximum amount of 5,5 billion euros in 2017, 4,6 billion in 2018 and 3,7 billion in 2019 with coverage rates of 63% for non-performing loans (in 2017) and 32% for substandard loans (again for 2017).
Under the management profile, the plan provides for a "rationalization of the cost base" and a review of the business model aimed at "making Carige the reference bank for families, small businesses and SMEs in the reference areas".
