INTESA SANPAOLO - INTESA SANPAOLO: CONSOLIDATED RESULTS AT JUNE 30th 2012 03/08/2012 12:17 - RSF
PRESS RELEASE
INTESA SANPAOLO: CONSOLIDATED RESULTS AT JUNE30th 2012
CAPITAL RATIOS:
STRONG CAPITAL BASE, WELL ABOVE REQUIREMENTS: 10.7% CORE TIER 1 RATIO; 11.7% TIER 1 RATIO;
10.1% PRO-FORMA EBA CAPITAL RATIO
OPERATING INCOME:
GROWTH (+2.6%) TO 8,944M VS 8,720M IN H1 2011;
4,131M IN Q2, -14.2% VS 4,813M IN Q1
OPERATING COSTS:
SIGNIFICANT REDUCTION (-1.9%) TO 4,450M VS 4,536M IN H1 2011;
2,243M IN Q2, +1.6% VS 2,207M IN Q1
OPERATING MARGIN: SIGNIFICANT GROWTH (+7.4%) TO 4,494M VS 4,184M IN H1 2011;
1,888 IN Q2,-27.6% VS 2,606M IN Q1
INCOME BEFORE TAX FROM CONTINUING OPERATIONS:
DECLINING, DUE TO PRUDENT PROVISIONING, TO2,262M
VS 2,544M IN H1 2011 (-11.1%);
731M IN Q2, -52.3% VS 1,531M IN Q1
NET INCOME:
DECREASING (-9.1%) TO 1,274M VS 1,402MIN H1 2011;
470M IN Q2, -41.5% VS 804M IN Q1
ADJUSTED NET INCOME (1):
1,039M VS 1,234M IN H1 2011;
289M IN Q2 VS 750M IN Q1.
Torino, Milano, August 3rd 2012 - The Intesa Sanpaolo Management Board in today's meeting approved the consolidated half-year report as at June 30th 2012 (2).
In the first half of 2012, the Group delivered positive results in achallenging environment, prioritising sustainable profitability: ______________________ (1) Methodological note on calculation of adjusted net income on page 16. (2) Methodological note on the scope of consolidation on page 16.
very strong andfurther improving capital base: further strengthening of capital
ratios (already well above regulatory requirements) at the end of June 2012, net of the
dividends accrued in the semester. The Core Tier 1 ratio increased to 10.7% from
10.1% atthe end of 2011 and the pro-forma EBA ratio to 10.1%(3), compared with the
9.2% ratio as a result of the EBA exercise conducted on the September 2011 figures and
the 9% threshold, top level amongst European peers;
high liquidity and strongfunding capability: liquid assets of 111 billion euro and a
broad availability of unencumbered assets eligible with Central Banks,
corresponding to liquidity of 50 billion euro, at the end of June 2012; already in
compliance with the Basel 3Liquidity Coverage Ratio and Net Stable Funding Ratio
requirements, well ahead of deadlines (2015 and 2018 respectively); direct deposits
from banking business up 2.5% from year-end 2011;
credit supporting the economy: growth in loans to small and medium enterprises and
mid corporates in Italy (up 0.4 billion euro, up 0.4%, versus the first half of 2011);
robust net income: 1,274 million euro in the first half of 2012; adjusted net income
equal to 1,039 million euro;
increasing operating income: up 2.6% versus the first half of 2011 (with net interest
income up 3.6%) to 8.9 billion euro, the highest level in the past eight semesters;
further reduction in operating costs: down 1.9% versus the first half of 2011,following
five consecutive years of decrease;
high efficiency, with the cost/income ratio down to 49.8%, top level amongst
European peers;
strong operating margin growth: up 7.4% versus the first half of 2011, to 4.5 billion
euro, thehighest level in the past eight semesters;
rigorous and prudent provisioning policy in a deteriorating credit environment, with
- loan loss provisions of approximately 2.1 billion euro in the semester, up 37%
compared with the first half of2011, in the presence of a 20% increase in the new
doubtful and substandard loan inflow,
- an increase in the coverage ratio of non-performing loans to 45.2% (adjusted as a
result of the doubtful loan disposal and the new past dueregulatory changes) from
44.6% in the first half of 2011,
- a strong reserve built on performing loans, at 2,647 million euro, equal to a prudent
80 basis-point buffer versus the 70 basis-point buffer for the first half of 2011. Therigorous and prudent provisioning policy is reflected in the recovery ratio of doubtful loans, equal on average to 146% of their net book value over the period 2009 - first half of 2012. ____________ (3) Estimated on the basis of the Core Tier 1 ratio as at June 30th 2012 and the impact of sovereign risk valuation at fair value based
on volumes and prices as at September 30th 2011, and considering a minimum capital requirement constraint (transitional floor)
equal to 80% of the capitalrequirements calculated on the basis of Basel 1 rules, as per EBA exercise. Assuming a transitional
floor at 85%, adopted by the Intesa Sanpaolo Group for the calculation of capital ratios (Core Tier 1, Tier 1 and Total capital),
the EBA capitalratio would be at 9.8%.
2 The income statement for the second quarter of 2012 The consolidated income statement for Q2 2012 (4) recorded operating income of 4,131 million euro, down 14.2% from 4,813 million euro in Q1 2012 and down 8.5% from 4,515 million euro in Q2 2011. In Q2 2012, net interest income - 2,431 million euro - was down 2.8% from 2,501 million euroin Q1 2012 and up 2.7% from 2,368 million euro in Q2 2011. Net fee and commission income amounted to 1,322 million euro, up 0.4% from 1,317 million euro in Q1 2012. In detail, fees and commissions on commercial banking activities were up by 4.2% whilethose on management, dealing and consultancy activities (including portfolio management, distribution of insurance products, dealing and placement of securities, etc.) were down by 7.8%. Under the latter, fees and commissions on dealing and placementof securities were down 37.9%, those on portfolio management were down 1.1%, and those on distribution of insurance products were up 11.3%. Net fee and commission income in Q2 2012 was down 6.2% compared with 1,410 million euro in Q2 2011. In detail, fees and commissions on commercial banking activities increased by 0.8%, and those on management, dealing and consultancy activities were down 12.1%. As part of the latter, those on dealing and placement of securities were down 24.3%, those on portfolio management down 10.5%, and those on distribution of insurance products down 3.1%.
_________ (4) During the preparation of the interim statement at September 30th 2008, in the wake of the global financial crisis, certain amendments to international accounting standards were introduced and adopted by the European Commission. In short, in accordance with these amendments it is possible to reclassify - in specific circumstances considered to be rare - unquoted financial instruments, or no longerquoted, in an active market and no longer held for trading or available for sale: in particular, out of the category "fair value through profit and loss" into the categories "available-for-sale" or the "held-to-maturity" or "loans and receivables", andout of the category "available-for-sale" into the category "loans and receivables". The Group, largely basing on the prices at July 1st 2008, reclassified financial assets held for trading of