A strong bank for a sustainable world 2023 Results Excellent performance with Balance sheet further strengthened in Q4 Well-diversified business model, ready to leverage on our leadership in Wealth Management, Protection & Advisory JTFS4 loon S February 6, 2024 MIL-BVA362-03032014-90141/VR Best-ever year with €7.7bn Net income 1 €7.7bn FY23 Net income (+76% vs FY22(1)), the best year ever (€7.9bn when excluding the final Resolution Fund contribution) €1.6bn Net income in Q4 (+49% vs 4Q22(1)), the best Q4 ev ...

Financial Data and Key Metrics Changes - The company reported a record net income of €7.7 billion for 2023, marking a 76% increase year-over-year [6][11] - The cost-income ratio reached its lowest level ever at 45% [26] - The company plans to distribute €5.4 billion in dividends for 2023, resulting in a dividend yield of 12%, the highest in Europe [4][17] - Net interest income is expected to grow significantly in 2024, with contributions from hedging facilities estimated to increase by €800 million to €900 million [65] Business Line Data and Key Metrics Changes - Wealth Management, Protection & Advisory services contributed nearly 50% to gross income in 2023, demonstrating resilience even in a high-interest rate environment [25] - Customer financial assets increased by over €100 billion year-over-year, reaching €1.3 trillion [24] - The company has identified €100 billion that can be converted into assets under management, aided by declining interest rates [15] Market Data and Key Metrics Changes - The company maintains a strong capital position with a common equity ratio of 13.7%, which is expected to increase further [29] - Non-performing loans (NPL) stock decreased to less than €10 billion, with a net NPL ratio below 1% [27] - The Italian GDP growth is projected to be above 1% in 2025, indicating a stable economic environment [32] Company Strategy and Development Direction - The company is focused on leveraging its diversified business model to succeed in any interest rate environment, particularly in Wealth Management [14] - A significant investment of €2.8 billion in technology and innovation is underway to enhance digital banking capabilities [8] - The company aims to maintain a high cash dividend payout ratio of 70% while evaluating additional distributions on a year-by-year basis [51] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a net income above €8 billion for 2024 and 2025, driven by strong revenue growth and controlled costs [35] - The company is well-positioned to benefit from a potential reduction in Euribor rates, which could enhance commission income [46] - Management emphasized the importance of maintaining a conservative approach to cost of risk, targeting below 40 basis points [90] Other Important Information - The company has committed €1.5 billion to address social needs and promote inclusion, with over €300 million already deployed in 2023 [18] - The company is recognized as a leader in ESG initiatives, with €45 billion in new lending to support the green economy [20] Q&A Session All Questions and Answers Question: Can you walk us through the key P&L drivers for net profit guidance for 2024, particularly on NII? - Management highlighted that net interest income is expected to grow due to stable deposit bases and contributions from aging facilities, with a conservative estimate of a 10 to 20 basis points increase in costs [39][41] Question: Regarding the €300 million of non-recurring costs in Q4, is the guidance for stable costs in 2024 excluding this amount? - Management confirmed that the €300 million relates to variable compensation and is a one-off, with the 2024 budget being ambitious and unlikely to repeat this cost [100] Question: How does the company view the potential for capital distribution given strong capital generation? - Management intends to maintain a 70% cash dividend payout ratio and will assess special distributions on a year-by-year basis, emphasizing the importance of a solid capital position [51][52] Question: What is the company's outlook on asset quality and cost of risk? - Management stated that the cost of risk is expected to remain below 40 basis points, with no plans to utilize overlays, reflecting a conservative approach to risk management [75][90] Question: Can you provide an update on client migration for Isybank? - Management reported that 300,000 clients have been migrated to Isybank, with ongoing efforts to accelerate this process [104]

Financial services stocks are a solid addition to any investor’s portfolio. This is because they offer reliable growth throughout the industry and substantial dividend payouts to investors.Financial services are a much-needed resource for individuals, corporations, and institutions alike. It gives individuals and businesses the peace of mind that their financial future is heading in the right direction and allows for attention to be given to other endeavors.Below are several financial services stocks offeri ...

Here are three stocks with buy rank and strong momentum characteristics for investors to consider today, January 22:Northern Trust Corporation (NTRS) : This financial holding company has a Zacks Rank #1 and witnessed the Zacks Consensus Estimate for its current year earnings increasing 8% over the last 60 days.Northern Trust Corporation's shares gained 26.4% over the last three months compared with the S&P 500’s advance of 14.3%. The company possesses a Momentum Score of A.Intesa Sanpaolo S.p.A. (ISNPY) : T ...

Sergio Delle Vedove/iStock Editorial via Getty Images Italian bank Intesa Sanpaolo S.p.A. (OTCPK:ISNPY)(OTCPK:IITSF) has performed strongly since I first covered it in early 2022. The ADSs have returned almost 70% in that time, justifying the initial Buy rating thanks to a surge in profitability on the back of higher interest rates and strong credit quality. Data by YCharts Where we go from here is an interesting question. Intesa stock has since re-rated up to around the 1x tangible book value per share ...

Financial Data and Key Metrics Changes - The company reported a net income of €6.1 billion for the first nine months of 2023, with €1.9 billion in Q3, marking the best nine-month and Q3 results in 16 years [7][14][19] - Net interest income increased by 65% year-over-year, with total revenues up nearly 20% [19][20] - The company improved its net income guidance for 2023 to above €7.5 billion [8][44] - The common equity ratio stands at 13.6%, with a projected increase in net income for 2024 and 2025 [10][44] Business Line Data and Key Metrics Changes - In Q3, net interest income rose over 6% quarter-over-quarter, contributing to record quarterly revenues, which were up 27% year-over-year [20][21] - Direct customer deposits increased by €3.5 billion in Q3, reaching the highest level ever [13][22] - The property and casualty insurance segment contributed more than €480 million in the nine-month period [23] Market Data and Key Metrics Changes - Customer financial assets exceeded €1.2 trillion, with an increase of almost €40 billion in the nine months [22] - The net NPL ratio is at 1%, with NPL inflows at historical lows, driving the cost of risk to just 28 basis points [25][28] Company Strategy and Development Direction - The company is focused on a tech transformation with over €2 billion invested, aiming to enhance efficiency and customer service through digital channels and artificial intelligence [5][34] - A strong commitment to ESG initiatives is evident, with a €1.5 billion contribution planned by 2027 to address social inequalities [12][18] - The company aims to maintain a high dividend yield of 11.5%, with a 70% cash payout on stated net income [8][45] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the Italian economy's resilience, projecting growth close to 1% for the year [41] - The company remains committed to supporting families and businesses facing challenges, emphasizing its role in social impact [11][12] - Future net income is expected to be higher than in 2023, with a focus on maintaining a strong capital position [8][44] Other Important Information - The company has a strong liquidity position, with a liquidity coverage ratio well above regulatory requirements [30][31] - The company is actively reducing its exposure to Russia, nearing zero [10][28] Q&A Session Summary Question: Capital distribution and profitability outlook for 2024 - Management confirmed that 12% CET1 ratio is adequate, with plans for share buybacks as part of capital distribution [51][55] - For 2024, net interest income is expected to increase, driven by higher Euribor rates and improved commission income [59][66] Question: NII assumptions and cost trends - Management expects stable deposit trends and a slight increase in loan volumes, with a focus on cost reduction [70][74] - The company aims for a reduction in costs excluding technology investments, while managing personnel costs effectively [75][76] Question: Stage 2 loans and Isybank migration - Management highlighted proactive measures to monitor and improve Stage 2 loans, with a successful migration to Isybank [78][89] - The migration has seen minimal disruption, with a high level of customer satisfaction [88][90] Question: Digital euro risks and opportunities - Management has not budgeted for digital euro investments in 2023 but plans to assess its impact in 2024 [97][100] Question: Impact of labor contracts on P&L - Management indicated that while personnel costs will increase, reductions from workforce adjustments will help mitigate overall cost increases [108]

Financial Data and Key Indicators Changes - The company reported a net income of EUR4.2 billion for the first half of 2023, with EUR2.3 billion in Q2, marking the best six months and quarter since 2007 for net income [6][14] - Full-year net income guidance has been raised to well above EUR7 billion, with expectations for 2024 and 2025 to exceed 2023 levels [6][16] - The common equity ratio stands at 14% before Q2 impacts, with a ratio above 15% when considering Deferred Tax Assets (DTA) [8][24] Business Line Data and Key Indicators Changes - Net interest income increased by almost 70% year-on-year, with a quarterly increase of 10% in Q2 [17][18] - Commissions began to recover, with a 4% increase in Q2, while insurance income rose by 16% [18][20] - Customer financial assets increased by EUR37 billion to EUR1.3 trillion, with direct customer deposits rising by EUR20 billion [9] Market Data and Key Indicators Changes - The net Non-Performing Loan (NPL) ratio is at 1%, with NPL inflows remaining at historical lows [22][23] - The annualized cost of risk stood at just 25 basis points, indicating strong asset quality [23] Company Strategy and Development Direction - The company is heavily investing in technology, with EUR1.8 billion already deployed, focusing on digital transformation through initiatives like IsyBank and Fideuram Direct [10][29] - The digital strategy is built on three pillars: Isytech as the technological backbone, new digital channels, and artificial intelligence to enhance efficiency and unlock new business opportunities [29][41] - The company aims to maintain a well-diversified and resilient business model, primarily focusing on wealth management and protection [28][46] Management's Comments on Operating Environment and Future Outlook - The management remains positive about the macroeconomic environment, citing better-than-expected growth and easing inflationary pressures [12][44] - The company is committed to supporting families and businesses facing economic challenges, emphasizing its role in social and climate initiatives [12][26] - The management expressed confidence in achieving significant net income and excess capital generation in the coming years [66][70] Other Important Information - The company has the highest dividend yield in Europe at 11%, with a commitment to a 70% cash payout ratio [7][47] - The liquidity coverage ratio and net stable funding ratio are well above regulatory requirements, indicating a strong liquidity position [25] Q&A Session Summary Question: What makes Isybank different from other online banks? - The CEO highlighted that the strategic focus is on Isytech, which supports Isybank, allowing for a unique and efficient banking experience [53][56] Question: What is the capital distribution policy going forward? - The CEO stated that the minimum capital ratio is 12%, with excess capital evaluated for distribution at the end of the year [63][80] Question: Can you specify your deposit beta assumptions for this year? - The CEO mentioned that the net interest income is expected to exceed EUR13.5 billion this year, with a strong outlook for 2024 and 2025 [68][81]

A strong bank for a sustainable world 1H23 Results The best six months ever with €4.2bn Net income A leading bank with a fintech approach: significant tech investments already deployed to continue to succeed in the future July 28, 2023 MIL-BVA362-03032014-90141/VR ISP delivered the best six months ever, while making significant tech investments to continue to succeed in the future 1 €4.2bn Net income in H1 (+80% vs 1H22(1)), the best six months since 2007 (€4.4bn when excluding the final Resolution Fund con ...

Financial Data and Key Metrics Changes - The company reported a net income of €2 billion for Q1 2023, marking the best quarter since 2007, with a nearly 19% year-over-year increase [3][9] - The common equity ratio increased to 13.7%, with expectations to reach close to 14% post Basel IV in 2025 [4][19] - The cost of risk was reported at a historical low of 17 basis points, with no release of overlays [9][18] Business Line Data and Key Metrics Changes - Net interest income rose by almost 70% year-over-year and 6% quarter-over-quarter, driven by an increase in market interest rates [12][13] - Customer financial assets increased by €11 billion in Q1, indicating strong growth in wealth management [14] - Operating costs remained stable year-over-year, with the lowest cost-income ratio recorded [9][16] Market Data and Key Metrics Changes - The company has a strong liquidity position with over €100 billion in excess medium/long-term liquidity and a liquidity coverage ratio well above regulatory requirements [5][11] - Direct deposits saw a slight decline, but there was a €4 billion growth in April, indicating a positive trend [15] Company Strategy and Development Direction - The company aims to exceed its €6.5 billion net income target by 2025, supported by rising interest rates and a strong focus on wealth management and advisory services [5][24] - The digital bank, Isybank, is set to launch by summer 2023, highlighting the company's commitment to technology evolution [6][21] - The company is focused on maintaining a strong capital position while rewarding shareholders through dividends and buybacks [4][25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the economic recovery in Italy, driven by lower energy prices and easing inflation [6][22] - The company is committed to supporting families and businesses facing economic challenges, with €400 billion in lending to the real economy [8][20] - The outlook for 2023 has been upgraded to a net income guidance of €7 billion, reflecting strong performance and market conditions [5][25] Other Important Information - The company has reduced its NPL stock by €54 billion since 2015, achieving a net NPA ratio of 1% [17] - The company is actively involved in social initiatives, contributing to community support and job preservation [20] Q&A Session Summary Question: Capital usage and net interest income assumptions - The management discussed the capital position, indicating a comfortable range between 13.5% and 14% for 2023, with significant excess capital expected in the coming years [29][30] - Regarding net interest income, a deposit beta of 40% is anticipated by year-end, with a conservative estimate for the total amount of deposits [41][42] Question: Fee and commission outlook - Management acknowledged weak fee and commission performance in Q1 but expects a rebound in 2024, focusing on structural improvements rather than immediate revenue increases [46][64] Question: Regulatory headwinds and cost of risk - The cost of risk is projected to be between 35 and 40 basis points for the year, with a positive outlook on asset quality and economic conditions [54][56] Question: Windfall tax implications - Management expressed willingness to comply with any government-imposed taxation, emphasizing the importance of using such funds to address social inequalities [70][72]

Financial Data and Key Metrics Changes - For 2022, the company reported a net income of €5.5 billion excluding provisions for Russia de-risking, which is well above the business plan target. Including Russia de-risking, net income was €4.4 billion, marking the best result in 15 years [6][15][33] - The company achieved the best-ever year for operating income, operating margin, and gross income, with Q4 being the best quarter ever for revenues [8][15] - The common equity ratio increased to 13.5%, up 110 basis points in Q4, reflecting a strong capital position [9][27] Business Line Data and Key Metrics Changes - Net interest income grew by 20% in 2022, with a significant acceleration in Q4, where it was up almost 60% year-on-year [19][20] - Commissions were resilient, with a slight increase of 3% on a quarterly basis despite the absence of performance fees [20] - Insurance income reached a record high, driven by strong growth in non-motor P&C revenues [19] Market Data and Key Metrics Changes - Customer financial assets reached €1.2 trillion, with a €26 billion increase in Q4, indicating strong growth in wealth management [23] - The company provided €400 billion in lending to the real economy, highlighting its commitment to supporting families and businesses [14] Company Strategy and Development Direction - The company aims to exceed its €6.5 billion net income target for 2025, driven by interest rate increases and a strong focus on cost management [7][18] - The execution of the 2022 business plan is proceeding at full speed, with 70% of initiatives ahead of schedule [29] - The company is committed to being a zero-Russia and zero-NPL bank, having reduced its gross NPL by €4.6 billion and its Russia exposure to below 0.3% of group exposure [10][24] Management's Comments on Operating Environment and Future Outlook - Management remains positive about the macroeconomic environment, expecting a quick recovery for the Italian economy by 2024 [12] - The company anticipates significant operating margin growth in 2023, driven by net interest income and a focus on cost management [33] - Management emphasized the importance of maintaining a conservative approach to guidance and capital distribution [66][69] Other Important Information - The company plans to distribute cash dividends of €3 billion, maintaining a 70% payout ratio, and will launch a second tranche of share buybacks [5][34] - The company has a strong capital position, with expectations to maintain a Common Equity Tier 1 ratio above 12% [10][35] Q&A Session Summary Question: What are the regulatory headwinds expected in 2023? - Management indicated an updated impact of approximately 70 basis points related to regulatory headwinds, with additional impacts from IFRS 17 [52][53] Question: Guidance for 2023 net income? - Management expects net income to be well above €5.5 billion, with a strong increase in net interest income of €2.5 billion [37][41] Question: Capital returns and payout mix? - Management confirmed a 70% payout ratio and indicated that decisions on excess capital distribution will be made at the end of 2023 [60][66] Question: Deposit betas and competition? - Management stated a conservative deposit beta assumption of 35% to 40%, emphasizing their market leadership in Italy [62][63] Question: Clarification on cost of risk? - Management noted a cost of risk of 30 basis points, with particular attention on commercial real estate and energy sectors [75][86]