“We will never make another capital increase. If there were someone who imposes it on me, I would resign. We won't do it because we don't need to." The managing director Pier Francesco Saviotti excludes from Banco Popolare's horizon a new appeal to the pockets of the shareholders on the day of the presentation to the market of the 2011-2013/2015 plan (three-year plan with extension to 2015) which aims to double the net profit in 2013 and triple it by 2015 (to 930 million euro in 2015 from 308 in 2010), bring operating income to 4,1 billion in 2013 and 4,5 in 2015, reduce the cost/income ratio to 55 per cent and increase the common equity ratio up to 8,3% in 2015. The share on the Stock Exchange reacts well to plans and declarations with an increase of 4,27% compared to 1,62% of the Ftse Mib (in any case the banks with the Bpm are doing well + 4,76%, Intesa + 2,8% and Unicredit + 2,74%).
Some operators in the room are on the lead: "Maybe it's a communication problem - says an analyst - you already said in last year's meeting that you wouldn't do it, then in December the tam tam broke out and in January the increase has started”. Already because Banco's shareholders were called at the beginning of the year to follow a two billion recapitalization, but probably better timing in the end.
“I declared that we had no intention of making increases – said Saviotti – because we had ongoing negotiations for the sale of assets. When the contacts in progress were closed, also due to the price on which we didn't agree, we had to change course and we focused on the increase: the need to strengthen the capital was clear to all”. Saviotti's reassurances are not far-fetched while we are witnessing a wave of uncertain capital increases on the lists and the entire banking sector is in difficulty due to the events on the Greek front, due to concerns about the growth of the sector in Italy and a on the capital requirements which in Europe seem to rise more and more (Sifi banks, i.e. banks of systemic importance, will be asked for additional capital buffers).
On this front, the targets of the plan are a common equity ratio of 7,6% in 2013 and 8,3% in 2015. This is an improvement of 240 basis points (190 net of 50 basis points expected from the progressive transition to Basel3) compared to March 2011 thanks to 100 basis points deriving from the management of the period, 80 basis points from the introduction of advanced tools for calculating credit risks and 60 basis points for the sale of non-strategic assets including the in the joint venture Agos Ducato to the French Crédit Agricole. “Relations with the French are long-standing and the joint venture is going very well – said Saviotti – of course, after three or four months, one has even broken down a bit and it's difficult to express absolute certainty”.
In short, the French are stubborn and on the other hand they too have to manage the same European scenario: the good solution to the matter is not improbable but not even so obvious. In any case, Saviotti reassures, there are alternative ideas (but the IPO seems to be the one most out of the question). Without considering the buffer of the 1 billion soft mandatory convertible loan which, however, the Bank has no intention of converting at the moment. “Currently it is worth about 40 capital points – explains Saviotti – but we have no intention of converting it, because it would be a tragedy, a crazy dilution. The intention is to repay it in cash at maturity, but let's just say that it is there as a buffer should any need arise that is not envisaged in the plan". But in the eyes of the market and the analysts interviewed by Firstonline immediately after the presentation, despite everything, it is always the question of assets that continues to remain the institution's greatest weakness, especially in comparison with other popular ones such as Ubi. “Compared to Ubi – counterattacks Saviotti – we have nothing to envy. The only problem we have compared to them is Italease.
On the contrary, we have a much lower leverage which mitigates our weak position of assets”. “We are working – he also said – to be, in non-biblical times and certainly well before the entry into force of Basel III, better positioned than where we are now. Then someone says that not even 7% will be enough but I'm sure that once back to normal it will be more than enough. Even with regard to the stress tests, our data show a situation of absolute tranquility: the 5% under stress is largely exceeded and I feel reasonably calm". Overall, the plan is judged by analysts to be aggressive but feasible, even if it did not hold any particular surprises, with macro scenarios that have been kept more conservative than other institutes, even if it will require a large commercial effort. In addition to the capital and risk management chapter (which also envisages robust growth in direct deposits and development of loans concentrated on local banks), the plan is based on two other pillars: efficiency and growth. As far as efficiency is concerned, the plan envisages the simplification of the corporate structure through the merger of three banks (Popular di Cremona and Popolare di Crema in Lodi; Efibanca will be absorbed into the parent company) and does not exclude new initiatives in the future which lead to of a "single bank" by preserving and enhancing the individual brands and further streamlining of the group with the relative economic benefits; the elimination of 180 overlapping branches, however going to restrict the mesh of the territorial coverage where the presence is already widespread; 1.120 people destined for the reduction of the workforce and the disposal of 50% of the non-instrumental real estate assets of Banca Italease for 500 million. In terms of growth, the aim is to: acquire around 250 customers (even without doing anything, growth is 65 customers a year) by 2013; increase the resources dedicated to the development of small business and affluent customers by 900 units; introduce the offer dedicated to the internet with "Youbanking"; targeted cross-selling initiatives with Banca Aletti and the transfer of the management of 15 companies from business centers to branches. The expected impact in terms of net income from the set of organizational reorganization and commercial relaunch projects amounts to 177 million in 2013 and 272 million in 2015, in addition to the ordinary growth of the group.
A few more numbers on the economic projections envisaged by the plan: on the credit front, adjustments are seen to progressively decrease by 541 million in 2013 and 492 in 2015 compared to 771 million in 2010, while the cost of credit decreased by 78 basis points of 2010 to 52 basis points in 2013 and 45 in 2015. Direct deposits are expected to increase by 3,9% per year on average in 2013 and by 3,4% in 2015, while the growth in loans expected on average in 2 year is 2013% in 2,2 and 2015% in 2015, also influenced by the progressive run-off of Italease loans with local banks growing in 4 with an average annual rate of 9,9%. The ratio of net non-performing loans to total net loans is expected to fall from 2010% in 8,2 to 2013% in 7,1 and 2015% in 9,3. Rote is forecast at 2013% in 12,6 and to 2015 in 40 and the dividend payout to XNUMX percent.
