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Unicredit exceeded expectations in the quarter, with a profit of 2.1 billion

2023-05-03T07:03:28.564Z


Record results. Revenues fly to 5.8 billion. Orcel: 'We are setting a new benchmark for the banking sector' (ANSA)


   Unicredit archives a record first quarter with profits of 2.1 billion euros.

Analysts were expecting 1.3 billion.

Revenues amounted to 5.8 billion euros, an increase of 56.5% year on year. 

   Unicredit's results reflect constant growth in quality, which has developed on all the main levers in all businesses, supported by an


interest margin of 3.3 billion, commissions of 2.0 billion, costs of 2.3 billion and loan loss provisions of €0.1 billion.

Excluding the contribution of Tltro, Tiering and excess cash fees booked in the fourth quarter, net revenues grew 22.3% quarter-over-quarter and 65.4% year-over-year, supported by sales network strength and by the progress made in industrial processing.

   Loan loss provisions, at €0.1 billion in the first quarter, decreased by 82.5% quarter-on-quarter and recorded a substantial year-on-year decline, also due to the effect of proactively booked loan loss provisions against exposures in Russia in the first quarter.


The group has solid lines of defense and a resilient and quality credit portfolio, with high coverage on non-performing exposures, as well as already existing overlays amounting to €1.8 billion.

Overall, this translates into a structurally low cost of risk of 8 basis points in Q1 2023 and unchanged cost of risk guidance of around 30-35 basis points for the year.

Operating expenses were $2.3 billion, down 5.8% quarter-over-quarter and 0.6% year-over-year.

   The group maintains industry-leading capital efficiency, with 111 basis points of organic capital generation in the first quarter, which led to a CET1 accounting ratio of 16.05%, already net of the approved distribution of 5.25 billion for 2022 and the cash dividend set aside in the first quarter, up from the CET1 ratio of 14.91% in the fourth quarter.

The capital generated organically amounted to 3.4 billion euros.

Risk-weighted assets (RWA) were reduced by 3.1% quarter-on-quarter, to $298.8 billion.

The Rote (the


return on tangible equity) is at 20.4.

   Furthermore, UniCredit has improved its financial guidance for 2023, with a NII (interest margin) of over €12.6 billion, net revenues exceeding €20.3 billion and net income above €6.5 billion, setting a new baseline for 2024-2025.

The bank also raised its shareholder distribution ambitions for 2023 to at least $5.75 billion.

   "For the ninth consecutive quarter UniCredit has achieved excellent financial results, improving the level of profitability and distribution thanks


to the ability to unleash the intrinsic value of the Group".

This was stated by the CEO of Unicredit, Andrea Orcel when commenting on the first quarter results.


"We are making significant progress in executing the strategic plan and we are in the second phase of our industrial transformation, setting a new benchmark for the banking sector", notes Orcel, adding that the bank is "strengthening the commercial network and optimizing our products and services to offer the best to our customers in the most efficient way". 


Source: ansa

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