Unicredit archives 2018 with positive numbers, but, in view of the new plan, announces an important change at the top. The last financial year has closed for the group with a profit of 6,4 billioni, up 13,1% year on year. This is the best result since 2008. At the core level, the net operating profit was 7,5 billion (+12,3%). Adjusted net income to 3,9 billion (+7,7%).
Just in fourth quarter, profit reached 840 million (+19,9% year on year). However, the figures for the period absorb a positive extraordinary tax effect of 887 million produced by the first adoption of the accounting standard ifrs9. Returning to the numbers of the whole of 2018, the group interest margin it reached 10,9 billion, an increase of 2,1% year on year. On the property side, the Cet1 ratio fully loaded stood at 12,07%.
Confirmed i target 2019: total revenues at 19,8 billion, operating expenses at 10,4 billion, group net profit at 4,7 billion, group Rote above 9% and group core Rote above 10%. The board of directors will propose to the shareholders' meeting the distribution of a cash dividend of €0,27 per share equal to a total dividend payout of 600 million euro.
As for the changes at the top, Unicredit announced the step back by the general manager Gianni Franco Papa, who – after 39 years in the group – will resign effective from 3,658 June, in agreement with the company. The manager was awarded a total package of 31 million euros for the termination of the relationship, equivalent to XNUMX months of total remuneration. The decision is part of the reorganization project of the managerial team contextual to the beginning of the work for the strategic plan 2020-23, which will be presented to the markets on 3 December 2019 in London.
In the rearrangement, among the various points, Richard Burton will become the head of the fully integrated Corporate and Investment Banking division, while Francesco Giordano and Olivier Khayat are appointed co-CEO Commercial Banking Western Europe.
“We are preparing to face the last part of the Transform 2019 marathon and with the achievement of our financial and operational objectives approaching, the time has come to prepare for the next strategic cycle – explains the CEO of Unicredit, Jean Pierre Mustier – All this will start from a managerial team with even more energy and a renewed structure able to implement the new strategy”. The next phase of UniCredit's transformation “will be long-term and will leverage the results of Transform 2019 with an even greater focus on the commercial banking business supported by a fully integrated Corporate and Investment Banking”.
"Transform 2019 is ahead of schedule – added the French manager -. We have already achieved 100 percent FTE reduction and 93 percent branch closure goals. Our Group's operating costs were €10,7 billion, better than the plan target of €11 billion. Group gross NPEs are down more than 50% compared to the third quarter of 2016, while non-core gross NPEs are €18,6 billion, down €7,5 billion year-on-year.
“Our plan is based on organic recruitment. We are a bank happily based in Italy and listed in Italy and we will continue to be so”, Mustier then commented in a conference call with the press agencies, replying to those who asked him to comment on the rumors about a possible separation of the group's activities. As regards the rumors about merger hypotheses in general, the Unicredit CEO retorted: “You shouldn't believe what you read, otherwise Unicredit would be the only bank in Europe that merges with all the others. There is an anthology of speculations that are without foundation”. However, Mustier recalled the importance of large banks in Europe “to support the economy and SMEs, pan-European banks. This is why Unicredit will continue to develop on a pan-European basis to support growth".
Subsequently, in the press conference, the number one of Unicredit also intervened by answering some questions from journalists, starting with Mediobanca. “I would have liked to have had a stronger pact than what was later decided because I think it is good for Italy to have a strong shareholder base in Mediobanca, to ensure that Mediobanca and above all its subsidiaries, and I am thinking in particular of the large insurance company (Generali, ed), can be protected and remain Italian, independent and listed in Italy“. But Mediobanca's shareholders have decided to sign a consultation agreement until 2021: "The other shareholders have chosen otherwise and we have followed the other shareholders", added the banker, reiterating that for Unicredit the stake in Mediobanca remains "a financial investment ”.
On the state of health of the Italian economy, which just today saw growth estimates for 2019 downsized by the EU, Mustier said he was not worried, "because the Italian economy has solid fundamentals". On Italy-France relations, as a French manager at the helm of an Italian group and following the tensions following the meeting of Deputy Prime Minister Luigi Di Maio with the yellow vests and President Macron's decision to recall the ambassador from Rome, Mustier did not expose himself, recalling however that for Unicredit "Italy is always in first place".
Mustier, on the other hand, did not provide particular information about any write-down of the portion of the Banca Carige subordinated bond in the belly of the bank. “We always have a conservative approach to risk,” he limited himself to saying. The banker declined to comment on what was done by Intesa Sanpaolo which totally devalued the stake held in the similar Banca Carige bond by 54 million. Unicredit holds a share of 60 million in the bond disbursed by the Interbank Deposit Protection Fund - Voluntary Scheme.
After the communication of the accounts, the Unicredit stock, which already in the session on Wednesday had been among the best, continued to earn, climbing nearly 5% by mid-morning, towards 11 euros per share.
Article updated at 15,10 pm on Thursday 7 February.
