UBI Banca sinks at -4% after profit under expectations. Massiah: among the few to give more dividends than requested for increases during the crisis


One of the great protagonists of the financial news of the last months, UBI Banca – whose name was first brought up for a probable merger with Banco BPM, and then with Bper and Banca Mps – raised the veil on the accounts for the third quarter and the market was disappointed. Quarterly profits below expectations triggered sales on the stock, which sold 4% to 2.776 euros.

Useful below expectations, well the reduction of Npl

Analysts expected a net profit of 72.8 million euro (range 59-93 mln), with revenues of 880.9 million and interest margin of 435.2 million with Bloomberg Intelligence which saw resilient revenues and an acceleration on the cost cuts. Well the results have disappointed expectations: The net accounting profit instead fell by 9.2% to 191.05 million euros considering the 9 months and in the third quarter it was 60.1 million euros from 1.6 million in the third quarter of 2018 (and from 48.7 million in the second quarter of 2019). In the nine months, however, the result of operations, the note reads, grew by 9.6% to 900.2 million (or 11.2% net of systemic contributions), a consequence of both the positive trend in revenues operating costs (+ 1.4% to € 2,689.4 million) and the continuous reduction in costs (-2.3% to € 1,789.2 million or -3.7% net of systemic contributions).
UBI has announced that it has significantly reduced i gross impaired loans (-2.2 billion against September 2018 and -1.4 billion vs. December 2018, mainly through internal management), and at the same time the CET1 ratio rose to 12.09% (without including future DTAs or optimization actions) from 11 , 42% in September 2018 and from 11.34% in December 2018. As regards indirect deposits, this exceeds 101 billion (+ 1.6% vs. June 2019 and + 6.7% vs. January 2019) and records once again an important increase in all its components.

Massiah: between sustainability and technology, we were pioneers

"We have seen that a considerable effort has been made by us to offset the negative effects of negative rates with the commission component, which has now almost reached the size of the interest margin, we are talking about a few million units per quarter of difference" commented the CEO Victor Massiah. "It is obvious that the most important component, however, of returning to profitability will be a reduction in the cost of credit, which was basically the most important factor in reducing the return on capital as regards Italian banks." The UBI number one also rejects the definition of the bank as traditional. "Frankly I do not recognize myself in this definition (…) we were the first to move on Social Bonds and among the first to move on Green Bond and this again is something that anticipated a trend, now given for normal, of solidity, of greens, greenery, sustainability, which we have seen before ”. "It is no coincidence that we are among the very few Italian banks that can say they paid more dividends than they asked for in terms of capital account and capital increases for their shareholders during the crisis. So I believe that our UBI needs to be re-read ”concludes Massiah. "It is a bank that is not afraid of not necessarily siding with the most fashionable thought of the moment, who has been a pioneer with Social Bonds, with Green Bonds but above all, let me say, with the overall solution of UBI Comunita.in which others are now going to realize in their own companies, on the part of sustainability that at this time is so fashionable and also on the part on which we normally tend to give judgment, that is to say on the technological side, has mobile banking solutions and online banking solutions type IWBank, which have nothing to envy to the best performances ”.

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