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Milano, 14th May 2002

CORRADO PASSERA APPOINTED MANAGING DIRECTOR AND CHIEF EXECUTIVE OFFICER OF THE GROUP TO CHRISTIAN MERLE BANK EQUITY INVESTMENTS AND INTERNET ACTIVITIES

Consolidated quarterly report as at  31st March 2002
BACK TO PROFITABILITY: NET INCOME OF 425 MILLION EURO

 

 

The appointment of the new Managing Director and CEO and the definition of delegated powers
Milano, 14th May 2002. IntesaBci’s Board of Directors, chaired by Giovanni Bazoli, appointed Corrado Passera Managing Director and Chief Executive Officer of the Bank and the Group, delegating to him all the powers as Chief Executive Officer and primary person responsible for operations. The Board also attributed to Christian Merle, who continues to perform his duties as Managing Director, the powers of supervision over bank equity investments both in Italy and abroad, in addition to the Internet initiatives (Intesa e-lab and multimedia bank).


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Consolidated quarterly report as at 31st March 2002
The Board of Directors of the Parent Company IntesaBci analysed the report and approved Gruppo IntesaBci’s consolidated quarterly financial statements which closed with a net income of 425 million euro.

The result, though lower than 553 million euro as at 31st March 2001,  represents the Group’s return to profitability after the involution recorded in the second part of 2001, attributable to the economic crisis and financial market difficulties following the tragic events of last September.

In the comparison with the corresponding period of 2001, it must be noted that a non-recurring dividend amounting to 92 million euro, referred to part of the income from the sale of an indirect stake in Seat Pagine Gialle, and a capital gain of 124 million euro, relative to the sale of the first group of branches, had been recorded in the first quarter of 2001.

More specifically, net interest income registered a slight decline (-2.4%) which reflected a contraction in the interest rate spread in line with the banking system’s; this effect was only partly offset by the substantial decrease in net interbank funding (approximately –30% on an annual basis), deriving from a significant rise in deposits and practically stable loans to customers, due to a particularly selective credit granting policy.
Interest margin, which equalled 1,539.8 million euro,  recorded a more significant decrease (-6.8%) which also stemmed from the aforementioned non-recurring dividend in the first quarter of 2001; net of non-recurring components, the decrease would have equalled approximately 1%.

The persisting unfavourable financial market situation affected net commissions which recorded a 9.4% decrease to 863 million euro, deriving mostly from securities trading;  the decrease was also significantly affected by the contraction in commissions on tax collection activities due to the changed regulations regarding concessionaires’ remuneration system. Other operating income also decreased due to lower capital gains on merchant banking activities. Profits on financial transactions showed a 10.6% increase to 88 million euro.

Net interest and other banking income therefore totalled 2,603.8 million euro (- 8% approximately).

Operating costs, excluding goodwill amortisation, amounted to 1,769.1 million euro with an overall 1% decrease; payroll recorded a 0.8% rise, while other administrative costs declined by 2.7%  and adjustments to fixed assets and intangibles by 4.3%.

Total provisions and adjustments equalled 303.5 million euro and recorded a 2.1% decrease.

Extraordinary income amounted to 230.3 million euro and was mostly attributable to the registration in the statement of income of the write-back of 183 million euro (of the almost 1.2 billion euro provided for in fiscal year 2001) resulting from the mark-to-market of the warrants put, deriving from the rise in the stock price.

As concerns the balance sheet, loans to customers equalled 179,345 million euro with a modest decline (-2.2%) with respect to the end of 2001. With regard to units operating in Italy, in terms of average for the first quarter of 2002 compared to the figure for the corresponding period of 2001, loans remained practically unchanged due to the aforementioned more selective credit granting policy. The incidence of net doubtful loans was unchanged at 3%, with a degree of coverage of doubtful loans of 60%.

Customer deposits under administration (+0.2%) was almost stable and exceeded 511,584 million euro. It is made up of direct customer deposits of 184,204 million euro and indirect customer deposits of almost 327,380 million euro. With regard to units operating in Italy, direct customer deposits recorded a 6.5% growth rate in terms of average for the quarter compared to the corresponding period of 2001. Managed funds recorded a 3% increase and almost reached 141,536 million euro.

As concerns capital ratios, as at 31st March 2002 the Tier 1 ratio (Tier 1 capital/Risk-weighted assets) equalled 6.25% (6.01% at the end of 2001) and the Total capital ratio (Total capital/Risk-weighted assets) equalled 9.66% (9.33% at the end of 2001).

At the end of the first quarter, Gruppo IntesaBci’s operating structure included 4,223 branches – of which 3,296 in Italy and 927 abroad – and 70,053 employees, 129 lower than as at 31st December 2001.


The results of main Group companies
The statement of income of the Parent Company IntesaBci, compared on consistent terms, closed with a net income of 400.9 million euro, with a slight decline compared to 2001 (-1.3%). As concerns main balance sheet aggregates, loans to customers recorded an approximately 3% decrease, while deposits recorded a more significant development, especially for the units operating in Italy (+4.2%).

Cassa di Risparmio di Parma e Piacenza closed the first quarter of 2002 with a net income of 32.6 million euro, which is not comparable with 57.2 million euro of the corresponding period in 2001 since the latter recorded extraordinary income in excess of 19 million euro. The increasing trend in the most significant balance sheet aggregates continued in the quarter and the latter confirmed the values reached at the end of 2001: loans to customers equalled 8,525 million euro, direct customer deposits 10,535 million euro and indirect customer deposits 22,160 million euro.

Also the balance sheet of Banca Popolare FriulAdria confirms the positive levels reached at the end of last year with loans to customers of 2,540 million euro, direct customer deposits of 2,664 million euro and indirect customer deposits of 5.219 million euro (+4% approximately). Operations in the first quarter closed with a net income of 8.7 million euro, with a 12% decline with respect to the corresponding quarter of 2001, attributable to the extraordinary income realised in that period on the sale of branches.

Banco di Chiavari e della Riviera Ligure closed the first quarter of the current year with a net income of 4.3 million euro up by over 16% compared to the analogous period of 2001. As concerns the balance sheet and with respect to values at year-end, loans to customers maintained their increasing trend (+1.2%) and reached 1,437 million euro, direct customer deposits (+0.7%) confirmed its position at 1,682 million euro and indirect customer deposits increased (by approximately 4%) to 3,248 million euro.

The other Italian banks of the Group also recorded positive results.

In spite of the difficult market context, Caboto IntesaBci Sim, which absorbed Caboto Sim, continued in the first three months of the year, after the internal reorganisation programme which enabled the start-up of new Retail Capital Market activities, to strengthen its competitive positioning with the entry of new, highly qualified resources. The company is at the top of the rankings for brokerage on MTA with a 6.8% market share while on NUM it rose from 4th to 3rd  position. The period closed with a net income of approximately 15 million euro to be compared on consistent terms with a loss of approximately 1 million euro in the previous reference period.

At the end of March 2002, assets managed by Nextra Investment Management Sgr equalled 112.3 billion euro with a 2% growth rate compared to December 2001. The company, which was formed by the integration of the two pre-existing asset management structures of Intesa and BCI, generated a net income for the period of 11.5 million euro.

Positive results were also recorded by: IntesaBci Mediocredito (13.1 million euro), which continued medium- and long-term lending operations previously carried out by Mediocredito Lombardo (merged in IntesaBci); Intesa Leasing  (4.7 million euro), which in the quarter increased the number of new contacts by 20% for a value of 596 million euro; and Mediofactoring (7.7 million euro) which registered an approximately 8% increase in turnover.

As concerns foreign subsidiaries, operations in the first quarter for the Sudameris group highlighted a loss of approximately 6 million euro, compared to the net income of 2 million euro of the corresponding period in 2001, mostly due to considerable extraordinary charges (approximately 17 million euro) recorded in the period and the significant income tax burden of certain subsidiaries. The group’s most significant balance sheet aggregates showed a contraction in both loans to customers (8,966 million euro)  and deposits (10,222 million euro), as a direct consequence of the devaluation of the Argentinean currency and the severe economic crisis which led to a liquidity outflow from the Country.

Group companies located in Central-Eastern Europe, thanks to the opportunities of the respective local markets, further developed their activities and realised appreciable results both in the statement of income and in the balance sheet. CIB (Central-European International Bank)  increased net income by approximately 17% to 11 million euro and loans to customers by 4% to over 1,900 million euro. Privredna Banka Zagreb confirmed its profitability potential with a net income for the period of approximately 30 million euro, 40% higher than the figure for the corresponding period of 2001. Loans to customers exceeded 1,900 million euro and showed an over 8% growth rate.


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In order to present more complete information regarding the quarterly results, the consolidated statement of income and balance sheet are attached (reclassified and in a summarised format). The latter are included in the report on operations approved by the Board of Directors. It must be pointed out that this quarterly report has not been subject to control by the auditing firm.

IntesaBci notifies that - pursuant to provisions set forth in Art. 82, par.2  of Consob resolution 11971 of 14th May 1999- the Half-Year Report as at 30th June 2002 will be available for shareholders and the market within the maximum term of  75 days, instead of the quarterly report as at 30th June 2002.

 

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Reclassified consolidated statement of income

Reclassified consolidated balance sheet

 

 

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