At the shareholders' meeting Andrea Orcell e Pietro Carlo Padoan, CEO and President of Unicredit they showed up with the pride of a 10-year high in earnings growth, a 10,7% return for shareholders, an almost doubled stock market value and a fresh ok from the ECB for a buy back of 3,34 billion, the largest ever launched by an Italian bank. The votes of the shareholders were therefore to approve the accounts, the buyback and the dividend. But they were also positive for requests for salary increases for managers, led by Andrea Orcel.
Today's meeting was attended by 3.641 shareholders representing 1.336.844.847 ordinary shares, equal to 68,88% of the share capital through the representative designated by UniCredit. The main shareholders present with stakes exceeding 3% of the share capital are the BlackRock Group, Parvus Asset Management Europe and the Allianz Group.
Il title in Piazza Affari it lost 0,10% to 17,44 euros per share.
The largest buyback ever launched by an Italian bank has been approved
On Tuesday, the ECB authorized the execution of the Unicredit buyback program for an amount of 3,343 billion, the largest share buyback plan ever launched by an Italian bank. “This is a further sign of the good governance of this Bank, especially in a critical and turbulent moment for the financial sector", said the Chairman of Unicredit Pier Carlo Padoan, at the opening of the shareholders' meeting today, and, he adds, "demonstrates the strength of our business model . We got the best results of the decade and seven consecutive quarters of growth.”
“The approval by the ECB, the bank said, is based on the financial information provided by the company, which highlighted a significant solidity of capital levels and an organic generation of capital at the top of the sector. Together with the consistency of the liquidity position, these elements guarantee that the company can face stress scenarios from a position of strength”. The authorization will allow the bank to distribute to shareholders a total of 5,25 billion (buyback plus dividends), 16% of market capitalisation. The pro forma Cet1 ratio post buyback and dividend is equal to 14,9% and the bank expects to increase it further.
The distribution of profits
“We're not only improving our metrics, but we're overhauling how we generate and distribute metrics to evaluate, so as to fuel growth and success” Padoan began this morning, addressing the shareholders.
Based on a Net income of 3,1 billion recorded on an individual basis for fiscal year 2022, the institute has obtained approval from the shareholders of the breakdown in this way:
– to the Shareholders, a unit dividend of 0,9872 euro for each outstanding share, entitled to payment on 26 April next, for a maximum amount of 1,906 billion euro corresponding to approximately 35% of the so-called "Group Net Profit".
– an amount of 20 million in favor of UniCredit Foundation for social, charitable and cultural initiatives.
– to the Reserve connected to the medium-term incentive system for Group personnel, an amount equal to 75 million.
– to the legal reserve 100 million.
– In addition, 5 million for initiatives aimed at the social and employment inclusion of young people, the promotion of education and support for the communities most impacted by the energy transition, establishing a specific reserve.
Padoan: focus on the strategic plan, we don't get distracted by market speculation
“We are focused on executing ours Strategic Plan and we will not lose focus. We will not be distracted by the exogenous context and market speculation” continued Padoan. He then added regarding Europe, "without real unity, in the form of a banking union and a financial markets union, we will not be able to unleash the potential of our continent and play the role that we could and should have on the world stage. And we need to start doing that now."
The ok to the 2022 budget. Orcel: our best result in over a decade
The assembly also voted in favor of the 2022 budget presented by the bank in Piazza Gae Aulenti in January and which showed a profit of 5,2 billion euros, higher than analysts' expectations, on a 10-year high. Compared to 2021, the increase is 64% to 5,4 billion excluding Russia, +47,7% considering Moscow. L'accounting profit for the full year, on the other hand, it amounts to 6,5 billion euros and includes, among other things, the release of DTAs in Austria and Italy for 852 million in the fourth quarter. “Unicredit has achieved a series of outstanding financial results that demonstrate significant progress in the industrial transformation journey and the ability to achieve excellent performance throughout the cycle” Orcel said, highlighting that the one recorded in 2022 “is our best result in over a decade".
Remuneration policies
The Unicredit board had proposed to amend the remuneration policy in order to be able to reward the exceeding of the targets. After weeks spent drafting diplomatic reports, Unicredit obtained the go-ahead from the assembly regarding the increase in the remuneration of over 900 managers and in particular regarding the compensation of the CEO, Andrea Orcel, up to 9,75 million euros (from 7,5 .XNUMX million), far surpassing friend and rival Charles Messina, CEO of Intesa Sanpaolo which in 2022 took 4,94 million between fixed and variable, based on the scheme in force since 2016
69,1% voted in favour, against an expected consensus of 55-65% of those present (still remotely).
Orcel, in the saddle for two years, had entered with a bonus of 5 million (criticized by the market fund advisors and passed with 54% of yes), today he has performance on his side: in addition to the growth in profits to a maximum of 10 years, a yield of 10,7% for shareholders and the stock market value almost doubled. The ambition to earn more, being Orcel already the banker highest paid in Italy, had created some discontent and, as in 2021, the opposition of Iss and Glass Lewis, the advisors of the institutional funds who in two dedicated notes had criticized the new remuneration policy, inviting the market to vote "against". Unicredit leveraged its historical shareholders and in recent days Parvus (5%), Allianz (3,3%), Norges (2,9%), Fondazione Cariverona (1,7%) had lined up. Other shareholders close to Orcel, already in the past, are Fondazione Crt and Delfin, at 1,9% each. And in the end the maxi-remuneration of the CEO passed.
