Statement by Carlo Messina, CEO of Intesa Sanpaolo full year 2019 results

“We fully met all of our 2019 Business Plan commitments:

• Growth in revenues, with a strong acceleration in wealth management marked by record levels of net inflows into Assets under Management in the fourth quarter
• Continued cost savings that place us at the top of European banks in terms of efficiency, all while investing significantly in digital, wealth management and employee training
• Lower cost of risk, with the lowest level of provisions since 2007
• Net income grew to €4.2 billion, up 24% when excluding one-off gains in 2018; and
• We confirmed a payout ratio of 80% with a cash dividend of €3.4 billion, with what we believe to be the highest dividend yield among all European banks.

“We achieved this while significantly strengthening our balance sheet, further reducing our NPL portfolio by €6 billion, leading to the lowest NPL stock since 2008, all at no cost to shareholders.

“The Bank's capital solidity, well above regulatory requirements, is increasing and ranks us at the top of the sector in Europe. Our Common Equity Tier 1 ratio was 14.1% at the end of the year, 4.6 percentage points above requirements.

“In 2019, we implemented a number of important operations that provide a foundation for solid future growth:

• We acquired control of the specialized Italian health insurance company RBM, that will push us to #2 in this fast-growing market segment;
• In China, we finalized a decisive step that will enable us to rapidly grow in wealth management in one of the world’s primary markets;
• We defined a strategic partnership with the payment systems provider Nexi whereby we agreed to sell our merchant acquiring business to Nexi – generating a €900 capital gain in 2020 – while acquiring a 9.9% stake in Nexi, giving Intesa Sanpaolo exposure to the upside in this fast-growing market; and
• We also announced a partnership with SisalPay to create Italy’s first ‘proximity banking’ network with over 50,000 points of sale that will provide banking and payment services.  

“Looking ahead, we commit to delivering a Net income in 2020 above that in 2019 – even when excluding the capital gain from the Nexi transaction (and well above when considering the gain) – with a payout ratio of 75%, thus providing a robust and sustainable cash dividend once again.

“Intesa Sanpaolo is a catalyst for growth of Italy’s real economy. In 2019, medium/long-term credit to households and businesses in Italy totaled more than €48 billion.

“We continued to work alongside companies to overcome momentary distress. In 2019, we helped around 18,500 companies return to performing status. Since 2014, we have helped about 112,000 companies recover, with a positive impact on jobs and supplier companies, helping 1.2 million Italians avoid financial stress.

“Intesa Sanpaolo believes that, as one of the most solid and profitable banks in Europe, we must be an engine for our country's sustainable and inclusive growth. That is why we are strongly committed to reducing social inequality, preserving art and culture, investing in young people and jobs creation, spreading innovation among Italian businesses and promoting the circular economy.

“To support the most needy, we have launched major projects and partnerships for the distribution of meals, bed places, medicines and clothing, with 9.5 million interventions so far.

“When faced with natural disasters, as in the recent case of Venice, we stand alongside those families affected with a plafond of €100 million and a 12-month suspension of mortgage payments. Following the collapse of the Morandi Bridge in Genoa, besides establishing of €50 million plafond and a 12-month suspension of mortgage payments, we are also cancelling first-home mortgages for properties deemed uninhabitable or to be demolished.

“Our concrete commitment to the Circular Economy through a dedicated €5 billion credit facility has so far provided around €760 million to support the first 63 initiatives.

“We are also promoters of significant cultural initiatives throughout Italy. Intesa Sanpaolo's three museums, the Gallerie d'Italia, hosted over 560,000 visitors in 2019. We also loaned over 230 works of art from our collection to other world-class museums.

“We initiated our Fund for Impact with an unsecured loan for the over 1.6 million university students in Italy, believing that investment in education is a key element for the country’s growth. In the first 10 months, disbursements reached €28 million.

“Convinced that job training plays an equally important role in the competitiveness of our economy, we launched a project to train and introduce young Italians to the workforce, so far involving 1,000 companies and training 700 young people.

“We are putting our solidity as a bank to the service of the European Green Deal with a €50 billion financing program in Italy over the next few years.

“We achieved these results thanks to our people in Italy and abroad. I want to thank them for the professionalism and responsibility with which they carry out their work, enabling us to continue to deliver all the objectives set in our Business Plan.”