Almost nine billion of net income, devaluation of falling loans, downward costs. But also a showy contraction of branches and staff. This is the picture traced by the First Cisl study office on the financial statements of the top five Italian banks (Intesa Sanpaolo, UniCredit, Banco Bpm, Mps and Ubi) in the first nine months of the year. "The banks celebrate, but celebrate only them – comments general secretary Riccardo Colombani – The decline in the number of employees and branches is dramatic: a thousand branches less than in September 2018 (- 6.6%), employees reduced by 3.6 %. A real bleeding ". The latest quarterly data "show unequivocally – adds the CISL banking leader – that the emergency is over but also that the lemon is now squeezed. It's time to tell the bankers clearly that the era of the cuts is over. " It is not in fact continuing to cut, Colombani underlines, that "one can hope to see revenues grow. The right path is to revive employment and wages, as we ask in the platform for the renewal of the national contract. The € 135 increase offered by the ABI is not enough ”.
Adjustments to credits and Npl
Credit quality is crucial to the profitability of the system. Adjustments on loans fell from 5.1 to 4.6 billion, with the incidence of net impaired loans (NPL ratio) now less than 4%. The weight of the flow of new non-performing loans is reduced, which, as documented by the Bank of Italy, has fallen to 1.5%, a value much lower than that measured in the pre-crisis years. The prospects are therefore improving as it is reasonable to expect that the costs for loan write-downs can also fall to the levels of the pre-crisis years, with recovery of costs for several billion at the system level. The ratio between operating costs and revenues fell to 54.7% compared to 55.2% in the first nine months of 2018.
"We want to start comparing ourselves with the banks on investment and development strategies, not only on the repercussions of cost cutting and downsizing – says Colombani – The end of the emergency of non-performing loans must lead to investments able to generate new revenues, with a renewed focus on sustainability and the social function of banking activity ".
More useful, work productivity increases
The Big 5 net profits exceed 8.7 billion, with a + 38.5%: a figure that does not derive only from extraordinary profits. The reduction in loan write-downs (-10.1%) has a strong impact, but there is also a strong increase in labor productivity. The net operating result per employee, ie the operating profit net of write-downs of loans, rises by 6.8%, in a context still characterized by production tensions due to a reduction in personnel and branches.
Despite the low level of interest rates and competition on services, core revenues per employee (interest margin and net commissions) remained substantially stable. In this context, there is a strong increase in the per capita banking product, which increased by 5.2% in the first nine months of 2019. "The banks – Colombani concludes – cannot think only of remunerating the shareholders, they must also pay the productivity of the banking work ".
The press release with the explanatory tables is attached