Half Year 2024 Banca Monte dei Paschi di Siena SpA Earnings Call Transcript
Key Points
- Net profit after six months reached EUR1.159 billion, with EUR827 million in Q2, including a positive net tax effect of EUR450 million.
- Gross operating profit increased by 18% year-on-year, crossing EUR1.1 billion.
- Revenues grew by almost 10% year-on-year, driven by an 8.3% increase in net interest income and a 9.8% rise in fees income.
- Cost/income ratio improved to 46% from 49% in the first half of 2023.
- Fully loaded CET1 ratio in June stood at 18.1%, among the highest in the banking system.
- Net performing loans remained stable, reflecting market trends, with a slight increase in the gross NPE ratio to 4.6% and net NPE ratio to 2.4%.
- Operating costs marginally grew to EUR925 million in the first half, primarily due to labor contract renewals.
- The bank's reliance on ECB funding has been reduced, but it still needs to manage its liquidity carefully.
- The cost of risk remained at 52 bps, in line with guidance but indicating ongoing risk management challenges.
- The sale of Monte Paschi Bank in France is ongoing, with a minimal contribution to gross operating profit, indicating potential uncertainties in international operations.
Good morning, everybody. Welcome to Monte Paschi first half result and business plan presentation. Today, I will first highlight some key achievements after six months of the year and then walk you through our evolving journey that combines technology with a human touch, inspired by a strategy that always revolves around our customers.
So let's start from financial results. Net profit after six months at EUR1.159 billion, of which EUR827 million in Q2 that includes a positive net tax effect of EUR450 million. Solid improvement in the operating performance is visible in gross operating profit that crossed the EUR1.1 billion increasing by 18% compared to last year and supported by EUR555 million profit in the second quarter.
The result was driven by almost double digit growth in revenues year-on-year and effective cost management that enabled us to practically absorb the impact of labor contract renewal. Cost income ratio has further improved to 46% versus 49% in first half '23.
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