Intesa Sanpaolo lifts the veil on the new industrial plan, the third signed by Carlo Messina in command of the bank since 2013. Between 2021 and 2025, the bank expects a net profit growth of 11.8% on average per year in the new business plan, with a 2025 profit of 6.5 billion. The Rote will rise to 13.9% in 2025 from 9.1% in 2021 and the Roe to 11.6% from 7.6%.
Understanding, the details of the new business plan
Revenues are expected to increase by 2.3% annually to 22.8 billion, 2 billion more than in 2021, of which 1.6 of commissions and 200 million from the business insurance. Operating costs are expected to decline by 0.8% per year, with an estimated cost / income ratio of 46.4%.
Expected creation of over 520 billion worth of value for all stakeholders: there distribution to shareholders will amount to overand 22 billion in the four years, of which over 6.6 billion in 2022, with a payout 70% and a buyback of 3.4 billion in 2022. Intesa underlines that ‘any further distribution will be evaluated year by year starting from 2023’.
Calculated 328 billion new medium / long-term credit for households and businesses (of which 285 in Italy), personnel expenses for 26.5 billion, purchases and investments for 17 billion, direct and indirect taxes for 15 billion, new credit to support non-profit activities for 25 billion, investments and donations for people in difficulty 500 million and new credit to the green economy and the circular economy for 88 billion.
On the front of investmentsIntesa Sanpaolo plans to spend 7.1 billion in the period 2022-2025, of which 5 for technology and growth, including around 650 million in the new one ‘Digital Bankit is to create a more efficient platform with which to achieve a structural cut in operating costs. In particular, cost savings of around 800 million per year are estimated when fully operational (2026-2027), of which over 600 million already in 2025.
2021 budget: net profits over 4 billion
The details on the new industrial plan arrive together with the 2021 accounts, filed with a net profit of 4.185 billion, up by 19.4% compared to 2020 (excluding the components relating to the acquisition of Ubi Banca, + 27.7% the accounting figure) and against a guidance that expected a result of over 4 billion.
Profit growth was achieved despite ‘allocations of 2.2 billion, of which 1.7 in the fourth quarter, to further strengthen the future sustainability of the group’s results’. In particular, Intesa carried out € 1.6 billion in adjustments to loans, of which 1.2 in the fourth quarter (when the profit amounted to € 179 million, compared to -3.1 billion in the same period of 2020).
The board proposes to give back to the other shareholders 4.9 billion, of which 1.5 from the dividend balance (in addition to the 1.4 billion advance already paid) and 3.4 billion buybacsk. As for capital strength, the Cet1 coefficient is 15.2% after deducting dividends and 14.2% also considering the proposed buyback.
In harmony with the market, the stock, which is dominated by positive opinions from analysts, started trading on the rise (+ 1.4%), but then changed course. And about half an hour after opening it moves into negative territory.