The profitability of Italian banks almost halved in the first six months of 2016. The Bank of Italy writes it in its latest economic bulletin. “In the first half of 2016 – reads the text – the profitability of the five largest groups decreased compared to the same period of the previous year: the annualized return on capital and reserves (Roe, the return on capital) stood at 3,7 .6,3% (from 2015% in the first six months of XNUMX)”.
In particular, Palazzo Koch points out that the operating result fell by a fifth, while operating costs "increased markedly (7,1 per cent), due to the extraordinary expenses connected with the redundancy incentive plans of part of the staff and contributions to the deposit guarantee and resolution funds (net of which the costs would have remained substantially unchanged)".
The interest margin and other revenues also contracted (by 2,1% and 4,5% respectively). Value adjustments to loans increased by 18,7 per cent, due to the significant increase in the coverage rates of non-performing exposures by some intermediaries.
HERITAGE RISES BUT REMAINS BELOW THE EUROPEAN AVERAGE
At the same time, the capital ratios of the five largest banking groups increased: at the end of June, the best quality capital (Cet1) and total own funds stood at 11,6% and 15,4% respectively. risk-weighted assets (15 basis points higher than in March).
Compared to the end of 2008, the coefficients of the major Italian groups relating to the best quality assets have doubled, reaching 11,6% at the end of June, compared to the average relating to the main European banks, they remain still lower by about two percentage points.
BANKS SHARES +20% AFTER THE POST-BREXIT COLLAPSE
“Overall in the quarter shares in the banking sector recorded a partial recovery, in the order of 9 per cent – continues the Bank of Italy -, compared to the decline observed after the Brexit referendum they increased by 20 per cent”.
As for the CDS premiums of the major Italian banks, “which had marked a significant increase following the outcome of the consultation held on 23 June in the United Kingdom, subsequently fell; in the third quarter as a whole they decreased by an average of 43 basis points (to 239 points)”, concludes Palazzo Koch.
