(Alliance News) - Banco BPM Spa reported Thursday that it ended 2023 with a net profit of EUR1.26 billion, up 85 percent from EUR685.0 million a year earlier.

In the fourth quarter alone, the bank posted a net income of EUR321.1 million, which compares with EUR319.0 million in the previous quarter.

Net interest income rose to EUR3.29 billion from EUR2.31 billion a year earlier while, in the fourth quarter alone, it touched EUR867.7 million, stable on a sequential basis.

Net commissions fell to EUR1.86 billion from EUR1.89 billion and operating income rose to EUR2.77 billion from EUR2.14 billion. Gross profit rose to EUR2.04 billion from EUR1.29 billion.

The bank's CET 1 ratio is 14.2 percent and compares with 12.8 percent as of December 31, 2022.

The stock of impaired loans fell 21 percent year-on-year to EUR1.9 billion, with coverage of non-performing loans at 60.9 percent, which rises to 68.8 percent when write-offs are included. Probable defaults rise to 43.2 percent from 40.3 percent, and total impaired loans remain almost stable at 50.4 percent from 50.6 percent; if write offs are included, the figure would be 55.2 percent.

Liquidity shows EUR41.9 billion, TLTRO III is EUR15.7 billion and LCR is 187%, with an NSFR of 129%.

Direct bank deposits rise 1.1% to EUR124.8 billion, insurance deposits are EUR15.0 billion and indirect deposits are EUR106.2 billion, up 16% year-on-year.

Banco BPM's board decided to propose a dividend of EUR0.56 to shareholders, more than double the previous year's dividend of EUR0.23.

For 2024, the bank confirms the upward trend in the group's net income, with earnings per share of around EUR0.90 net of nonrecurring items, in line with the profitability trajectories outlined in the Strategic Plan presented last December 12. In light of the trends and the ability to generate stable increases in profitability and organic capital creation, BPM confirms all the profitability and shareholder remuneration targets announced in the last plan.

Giuseppe Castagna, chief executive officer of Banco BPM, said, "We are indeed very pleased with the brilliant results achieved: the net income of around EUR1.3 billion and the proposed dividend above guidance of EUR0.56 per share clearly summarize the ability to generate value that we have steadily achieved and that, by virtue of the strategic plan approved last December, we will continue to develop with increasing incisiveness."

"The current pace of value creation allows us to flank the solidity of the capital position and a dividend more than doubled compared to 2022 with the steady improvement in asset quality, evidenced by the cost of risk decreasing to 53 basis points compared to 62 bp in the previous year. This result was achieved not only thanks to selective lending policies but also to the derisking strategy that led to a further reduction of impaired loans in total gross loans."

Banco BPM's stock is up 1.2 percent at EUR5.10 per share.

By Giuseppe Fabio Ciccomascolo, Alliance News senior reporter

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