Intesa, profit above estimates at 2.6 billion. Messina: 'We are out of the game'

Intesa Sanpaolo beat analysts' estimates and closed the first quarter with a net profit up 13.6% to EUR 2.61 billion, from EUR 2.3 billion in the same period last year. The group confirms a profit target of 'well over 9 billion' for 2025. During the conference call with financial analysts, CEO Carlo Messina said that 'we are achieving important synergies without the need to make acquisitions and avoiding the associated risks'.

"If you remember, I talked about a big confusion, I said there was a mess," Messina said, responding to a question about consolidation in the sector. 'What we see today,' he added, 'increases the confusion and this confirms my opinion. There is so much potential here and it can lead our shareholders to tell us to focus on accelerating what we have. We will not participate in such a crowded market. And nobody needs an additional player coming in and creating further confusion'.

The bank expects a strong value distribution with a cash payout ratio of 70% of consolidated net profit for each year of the business plan, with an increased dividend per share for 2025 compared to the amount for 2024. A EUR 2bn buyback is planned to start in June 2025; further distribution for 2025 to be quantified when annual results are approved.

Net operating income came to EUR 6.8bn (+0.5%), with growth in net commissions (+7% to EUR 2.4bn) offsetting the decline in net interest income (-8% to EUR 3.6bn). Operating expenses fell by 0.5% to 2.58 billion euro, for a cost/income ratio that dropped to 38%, "among the best among Europe's largest banks". As regards capital strength, the Cet 1 ratio as at 31 March stood at 13.3%, up by around 45 basis points in the quarter after deducting the €1.8bn in accrued dividends and the €2bn buyback to be launched in June.

The implementation of Intesa Sanpaolo's 2022-2025 business plan is progressing at full speed, with a net profit outlook for 2025 confirmed at well over EUR 9 billion. The bank wrote this in its results note for the first quarter of the year. Intesa Sanpaolo for 2025 expects revenues to grow, managed in an integrated manner, with resilience in net interest income (expected at a higher level than in 023), thanks to the higher contribution of hedging on demand items; increase in net fee and commission income and in the insurance business, based on the group's leadership in wealth management, protection & advisory; strong growth in trading profits; falling operating costs; low cost of risk; lower taxes and other charges on the banking and insurance system, as there is no longer any contribution to the deposit guarantee fund.