Credem's Board of Directors, under the chairmanship of George Ferrari, today approved the individual and consolidated results for 2017. The preliminary data communicated on 8 February were confirmed in full with the exception of the capital ratios which increased following the authorization not to deduct the equity investment in Credemvita received in date 1 March 2018 by the European Central Bank and effective from 31 December 2017. In particular, the CET1 ratio increased from 13,32% to 13,69% (+37 bps), more than 6 percentage points above the minimum level assigned by the ECB for 2018 equal to 7,375%, confirming the security, reliability and solidity of the Group. Furthermore, the Tier1 capital ratio increased from 13,36% to 13,76% (+40 bps) and the Total capital ratio increased from 14,99% to 15,57% (+58 bps).
The draft financial statements will be submitted for approval to the Shareholders' Meeting on first call on 27 April and, on second call, on 1 May.
Even in a particularly complex market context, Credem, by placing the consolidated relationship with customers and the quality of the people who work in the Group at the center of its strategy, has further improved its profitability, proposing to the Shareholders' Meeting a dividend up 33% compared to 2016 at €0,20 per share. The total amount of dividends therefore amounts to approximately 66,2 million euros for a total of 165,5 million euros of dividends distributed in the last three years(3). The coupon will be paid starting from 16 May 2018 with detachment on 14 May 2018 and record date on 15 May 2018.
In 2017, in summary, the Credem Group recorded the following consolidated results:
Solidity at the highest levels of the system with a CET1 Ratio equal to 13,69%, more than six percentage points higher than the minimum 7,375% assigned by the ECB for 2018, profitability in further improvement with consolidated net profit up 41,4% y/y to €186,5 million (after spending €19,8 million gross of the tax effect for national and European rescue funds), Loans to customers up 4,4% y/y with asset quality among the highest in the system (gross problem loans to gross loans ratio at 5,2%), continuous investments in people with 256 assumptions, constant growth of clients (over 100 new customers) and of collection (+4,1 billion euros).
Foreseeable evolution of management
As far as the Group is concerned, the main management guidelines envisage the confirmation of solid capital and risk levels. The pace of commercial development will remain significant and will be supported, on the one hand, by a service model increasingly oriented towards omnichannel and digitization and, on the other, by the distribution and production enhancement of the Wealth Management business. Furthermore, a further diversification of the securities portfolio is envisaged to monitor capital volatility and the maintenance of significant investments aimed at the evolution of the information system and regulatory compliance.
In this context, it is possible to predict a linear trend for the Group as regards the stable components of both financial and commission revenues. However, elements of probable discontinuity are associated with this trend, in particular with reference to the contribution of the finance area where a slowdown is expected driven by greater financial stability.
The incidence of credit risk is expected to be substantially in line with 2017, just as the level of expenditure and investments will be confirmed as significant with simultaneous and increasingly pervasive economic efficiency initiatives.
Remuneration plans based on financial instruments
In today's meeting, the Board of Directors resolved to submit the remuneration system based on financial instruments called the “27 Incentive Plan” for authorization by the Ordinary Shareholders' Meeting of 2018 April 2018. This initiative is aimed at motivating and retaining people who occupy key positions in the Group, as well as ensuring compliance with sector regulatory provisions and is intended for the 4 Executive Directors, the General Manager, 13 executives with strategic responsibilities and the other " key personnel” of the Credito Emiliano Group (25 managers). In detail, the free assignment of ordinary shares of Credito Emiliano SpA equal to 50% of the recognized bonuses is envisaged, to be deferred over a period of at least four years. The attribution is envisaged on a constant professional basis and upon the achievement of predefined overall and individual performance levels, as detailed in the "Information Document" relating to the Plan itself.
Since the activation of the Plan is conditional on the achievement of future objectives, the information relating to the maximum number of financial instruments assigned will be disclosed, in compliance with the regulatory provisions, at a time subsequent to that in which they will be available to the company. In the same meeting, the Board of Directors, taking into account the opinion of the Remuneration Committee of 9 March 2018, verified the conditions for the activation of the "2017 Incentive Plan", for a maximum number of ordinary shares of Credito Emiliano SpA assigned equal to 343.826. Further details relating to the plans indicated above are illustrated in tables no. 2 and no. 8 attached to the Annual Report to the Shareholders' Meeting on the Group's remuneration and incentive policies. The "Information document relating to the 2018 share-based Incentive Plan" will be made available to shareholders at the registered office and on the website www.credem.it – section “Who we are – assemblies” from 16 March 2018; the "Annual report to the Shareholders' Meeting relating to the Group's remuneration and incentive policies" prepared in accordance with current regulations will be made available to shareholders at the registered office and on the website www.credem.it – “Who We Are – Assemblies” section from 6 April 2018.
