Q3 2024 Intesa Sanpaolo SpA Earnings Call Transcript
Key Points
- Intesa Sanpaolo (IITSF) delivered a record net income of EUR7.2 billion in the first nine months of the year, with EUR2.4 billion in Q3 alone.
- The company confirmed its net income guidance of above EUR8.5 billion for the year and increased its guidance for next year to around EUR9 billion.
- Intesa Sanpaolo (IITSF) has a strong dividend yield of 10%, with a total distribution of EUR7.5 billion, including a EUR3 billion interim dividend.
- The bank is heavily investing in technology, with EUR3.5 billion already deployed, and plans to invest an additional EUR1.5 billion by 2025.
- Asset quality remains strong, with NPL ratios at historical lows and a common equity Tier 1 ratio of 13.9%.
- Net interest income showed resilience but faced challenges due to a 30 basis point drop in Euribor and weak loan volumes.
- Operating costs are down only when excluding the impact of the national labor contract renewal and depreciation for tech investments.
- The company faces potential risks from significant Q4 managerial actions aimed at strengthening future profitability.
- There is a need for further internal synergies and cost reductions, with plans for 9,000 exits over three years.
- The insurance income experienced quarterly declines, particularly in the life insurance segment, which had negative inflows earlier in the year.
Welcome to our nine-month results conference call. This is Carlo Messina, Chief Executive Officer; and I'm here with Luca Bocca, our CFO; Marco Delfrate and Andrea Tamagnini, Investor Relations officers. We just delivered net income of EUR7.2 billion in the first 9 months of the year, of which EUR2.4 billion in Q3. These high-quality results are marked by strong growth in commissions and insurance income. Costs are stable.
Asset quality remains top-notch, and we strongly increased the common equity ratio and customer financial assets. Our excellent results mean that for this year, we can confirm our net income guidance of above EUR8.5 billion despite significant Q4 managerial actions to strengthen future profitability. At the same time, for next year, we can increase our guidance for net income to around EUR9 billion and our capital projection to 15% pre Basel 4. Turning back to our results, earnings per share grew 20% on a yearly basis. And this year, we will reward shareholders
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