Another satisfactory quarterly report presented by Intesa Sanpaolo, with a net book profit of 6,4 billion in the first nine months of 2020. Excluding the negative goodwill of 3,3 billion originating from the acquisition of Ubi Banca (which will be allocated in the fourth integration costs) and the two months of Ubi's contribution, the profit amounted to 3,07 billion, down by 7,2% compared to the same period of 2019. However, the result, underlines the institute, is already higher than the approximately 3 billion minimum net income expected for fiscal 2020 and it would amount to 3,9 billion (+20% approximately) "if we exclude the value adjustments on loans equal to 1,3 billion for the future impacts of Covid-19".
Again net of Ubi, with which the merger will be completed in 2021, operating income fell by 3,2% to 13,16 billion, with net interest at 5,3 billion (+1,1%) and net commissions to 5,45 billion (-6%). Operating costs fell by 3,7% to 6,6 billion for a cost/income ratio down to 50,1%. As for capital solidity, the Cet1 is equal to 15,2% pro forma when fully operational, after deducting 2,3 billion in dividends accrued, and 15,9% excluding the acquisition of Ubi. "The capitalization is very high, largely exceeding the regulatory requirements", adds the note from the bank led by Carlo Messina, whose share rises in Piazza Affari by almost 4% at 1,6 euro per share.
The CEO thus commented on the performance: “In the first nine months of the year, against a very challenging environment, we achieved a net profit of 3,1 billion euro. This means that in the first nine months of the year alone we exceeded our commitment for 2020, i.e. that of a net profit of at least 3 billion. In the fourth quarter, we will decide how to use the negative goodwill to strengthen the bank's balance sheet e face 2021 in a condition of further solidity. In the third quarter, revenues benefited from a significant recovery in net interest income and fees. Furthermore, the net flow of assets under management is accelerating. The sharp drop in costs continues, confirming our level of operational efficiency among the highest in Europe”.
Intesa Sanpaolo also confirmed the target on profits and dividends. In detail, without considering Ubi, the group "expects that net profit will be no less than around 3 billion in 2020 and no less than around 3,5 billion in 2021, assuming a cost of risk potentially up to around 90 cents of a point for 2020 and up to about 70 basis points for 2021”. By including Ubi, however, “a net profit of no less than 2022 billion is expected from 5 and the continuation of a strategy focused on remuneration for shareholders and on maintaining solid capital ratios”. As for dividends, the bank will pay cash corresponding to a payout ratio equal to 75% of the net result for the 2020 financial year and 70% for the 2021 financial year, subject to the indications that will be provided by the ECB regarding the distribution of dividends after January 2021, XNUMX.
Also confirmed the intention to also pay the dividend set aside for the 2019 financial year with a cash distribution of reserves. With regard to the Ubi Banca operation, everything is proceeding according to plan: "The generation of sustainable value - explains the note - for all stakeholders will be increased by the merger with Ubi Banca following the control acquired on 5 August last, which is proceeding successfully and not presents significant complexities, also in consideration of Intesa Sanpaolo's proven ability to implement integrations. We confirm the intention of enhance the local realities and the people of Ubi Banca achieving a further reduction of the risk profile and important synergies without social costs.
The CEO Carlo Messina also spoke on the Covid emergency, which Intesa Sanpaolo has been able to manage effectively, without failing to make an important contribution to businesses and households, and by securing its employees (63.000 of whom are enabled for smart working, 77.000 counting those of Ubi Banca): extraordinary emergency caused by the Covid19 pandemic, the Bank has implemented concrete initiatives to support the community, our customers and our people. We carry out our projects by representing a reference point for families, for businesses and convinced of our role as an engine at the service of inclusive and sustainable growth".
“The resources that, in the form of donations, we have deployed to deal with the emergency exceed 125 million euros, with a speech that saw the participation not only of the Bank, but also of its managers, employees and customers. Our role in supporting the economy is manifesting itself with significant evidence: support for the country's economy is made concrete by 60 billion credit available to households and businesses, with the consequent protection of employment and the maintenance of liquidity flows between production sectors. These measures also include an innovative tool such as that of impact loans in favor of the cohesion of entrepreneurial fabrics active in the area”, added Messina.
“We were the first to promote moratoriums – concluded the manager – and over the past few months we have granted them for a total value of 66 billion. Also, we have disbursed loans backed by state guarantees for a total of approximately 24 billion. Our role as an engine at the service of sustainable growth is made possible by Intesa Sanpaolo's ability to maintain resilient profitability over time, accompanied by increasing levels of efficiency, together with capital solidity among the highest in the European banking sector".
