Intesa Sanpaolo bid for UBI Banca: Statement by CEO Carlo Messina

Intesa Sanpaolo has announced a Voluntary Public Exchange Offer for UBI Banca ordinary shares. Commenting on the operation, Intesa Sanpaolo CEO Carlo Messina stated:

“The operation we are announcing today opens a new chapter in this Group’s history: we want to combine Intesa Sanpaolo and UBI Banca – two of the best players in Italy’s banking system – to create a new leader in sustainable and inclusive growth.

“Let me first underline who we are as ISP.

“We are one of Europe’s most solid and profitable banking groups, the fruit of successful aggregation, that counts over 90,000 people who represent the best of European banking.

“Our strength has benefitted all of our stakeholders. We have supported Italy’s families and businesses as one of the biggest lenders in Europe. We protected the savings of our clients during Italy’s crisis years, again thanks to the strength of our balance sheet. As one of Italy’s leading employers, we have always protected jobs. And in recent years we launched one of Europe’s most ambitious social impact programs. We did all of this while guaranteeing a generous cash dividend for our shareholders and maintaining a rock-solid capital base.

“The operation we are launching today marks a significant innovation in the strategy we have pursued in the past few years. In the new era of European banking of the 2020s, we need to look ahead and set new goals.

“Our Bank has always been distinguished by its ability to look ahead. We showed this in 2011 when – before any other bank – we acted to strengthen our capital base. That smart move enabled us to face new criteria set by the ECB and laid the foundation for a decade of growth that has brought us to where we are today.

“Our industry, at a European level, has entered a phase that requires greater scale, increased investment capacity and a focus on socially sustainable finance in order to excel. Thanks to this operation, the bank that will emerge from the integration of Intesa Sanpaolo and UBI will be one of the leaders of the new banking system.

“Together, loans to customers will total around €460 billion. The savings entrusted by Italians to the new Bank will exceed €1.1 trillion. And combined revenues will reach €21 billion. These numbers show the full strength of the Italian economy, the capacity of our businesses, and the solidity of our household savings.

“UBI is the best run medium-sized bank in Italy, both in terms of its balance sheet and its commitment to the real economy and sustainability.

“UBI’s CEO and management team have done an excellent job, and they can expect notable opportunities inside the new Group that will emerge from this operation. Indeed, Intesa Sanpaolo can be an accelerating factor in achieving the objectives just announced in the new UBI business plan.

“Together, we will create a European leader able to:

• Deliver a Net income of over €6 billion in 2022;
• Reward shareholders with a high and sustainable dividend, equal to €0.20 per share for 2020 and above €0.20 per share for 2021;
• Accelerate the reduction of non-performing loans at no cost shareholders; and
• Confirm high capital strength, with an expected Common Equity ratio above 13%.

“Thanks to its income generation capacity and capital solidity, the Bank that will emerge from the combination between Intesa Sanpaolo and UBI will be able to:

• Guarantee €30 billion of additional credit to support the Italian economy over the next three years;
• Increase new financing for the Green Economy from €50 billion to €60 billion, and our dedicated circular economy credit facility will grow by €1 billion to a total of €6 billion;
• Expand the lending capacity of our Fund for Impact from €1.25 billion to €1.5 billion;
• Bring young talents into the new Group thanks to a hiring program for 2,500 new employees, promoting generational change and supporting employment; and
• Increase assistance for people in need (i.e. distribution of meals, beds, clothing and food) from 11.5 million interventions to 13.5 million in the next three years.

“This project brings together two banks that share similar business models and values – and thanks to the professionalism of the more than 110,000 people who will be part of this new Group – we will ensure solid prospects for sustainable and inclusive growth in our country.”