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UniCredit’s Strong Q3 Performance

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UniCredit, one of Italy’s leading banks, announced its impressive third-quarter results today, surpassing the expectations of financial analysts. Let’s take a closer look at the key highlights:

Revenue Growth

During the third quarter, UniCredit generated a total revenue of 5.97 billion euros ($6.37 billion). Although this figure remained consistent with the previous quarter, it marked an impressive 24% increase compared to the same period last year. Analysts had predicted a slightly lower quarterly revenue of EUR5.74 billion, according to the bank’s provided consensus.

Net Interest Income Improvement

UniCredit achieved a net interest income of EUR3.6 billion, indicating a noteworthy growth of 2.9% compared to the previous quarter and a substantial 45% rise from the previous year. Analysts had anticipated this key revenue metric to amount to EUR3.5 billion for the quarter, as per the bank’s consensus.

Impressive Net Profit

In the third quarter, UniCredit reported a net profit of EUR2.32 billion. This result represented a minimal increase of half a percentage point compared to the preceding quarter but an impressive surge of 36% when compared to the same quarter last year. Analysts had projected a net profit of EUR1.92 billion, aligning with the bank’s provided consensus.

These notable achievements clearly demonstrate UniCredit’s strong performance and ability to exceed expectations.

UniCredit Raises Guidance for 2023 Net Interest Income and Revenue

UniCredit, an Italian bank, has adjusted its guidance for net interest income and net revenue for the year 2023. Thanks to an improved interest-rate environment, the bank now anticipates at least EUR13.7 billion in net interest income and revenue surpassing EUR22.2 billion.

Positive Outlook

Analyst Andrea Lisi from Equita Sim suggests that UniCredit’s conservative estimate may be surpassed, as the bank achieved a net profit of EUR6.7 billion during the first nine months of this year. The new profit target for 2023 is set at a minimum of EUR7.25 billion.

Shareholder Distribution

Furthermore, UniCredit has projected a net profit of at least EUR7.25 billion for the upcoming year. Additionally, it plans to distribute at least EUR6.5 billion to its shareholders.

Future Expectations

While UniCredit foresees a moderation in net interest income in 2024, it has decided against paying the Italian government’s 2024 windfall tax. Instead, the bank will allocate EUR1.1 billion to a nondistributable reserve.

UniCredit’s revised guidance reflects its optimistic outlook for the future, taking advantage of favorable market conditions and prioritizing its shareholders’ interests.

Financial Conditions

  • Average commercial deposits:
    • As of the end of Sept. 30, the average commercial deposits have declined 1.6% compared to 2Q and fell 5.6% compared with the third quarter of last year.
  • Average gross commercial performing loans:
    • On a quarterly basis, the average gross commercial performing loans decreased by 1.3% and 4.2% on a yearly basis, respectively.
  • Customer loans:
    • In the third quarter, customer loans fell by 5.6% compared to the previous year.
  • Customer deposits:
    • Customer deposits also fell by 5.5% compared to the previous year in the same period.
  • CET 1 ratio:
    • The bank finished the quarter with a CET (Common Equity Tier) 1 ratio of 17.19%, which is an increase from 15.41% recorded a year prior.
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