Shareholders' meeting: statements by the Chairman and CEO
Intesa Sanpaolo Shareholders' Meeting was held today at the Group’s Headquarters in Turin.
We are all personally touched as we face a health emergency the severity of which had not been fully understood. At this moment it is necessary to intervene promptly, and at the same time a long-term vision is required to protect and build the future of the community.
Intesa Sanpaolo responded immediately, in February, by placing €100 million at the disposal of the Civil Protection Department, to meet new healthcare needs; it also assisted with the construction of the Alpini field hospital in the city of Bergamo. The Group immediately granted mortgage and loan payment suspensions to families and businesses, which can be activated remotely. In response to the liquidity needs of businesses, Intesa Sanpaolo established a €50 billion financing facility. For schools and students, we have supplied computers and tablets and promoted free access to online educational platforms.
We offer our financing capacity, one of Europe’s most substantial, to make the most effective use of the tools put in place by the institutions.
We manage our business fully aware of its essential nature for Italy’s economic and civil life. We have ensured its business continuity, protecting the health of our people and that of our customers. We have reorganized our services and work activities, leveraging on our significant development of digital and mobile procedures carried out in recent years, intensifying their application. Intesa Sanpaolo’s people responded generously and effectively to the needs of the community.
We understand the importance of our role and we are committed to providing the vital lymph for the functioning of the economy and the survival of all its actors. In March and April, we granted over €2.0 billion in new loans to SMEs with nearly 14,000 requests. We have granted some 180,000 mortgage and loan suspensions to businesses and families for a value of around €22 billion.
Our commitment aims not just to facilitate the recovery, a return to the status quo, but also to use this unique opportunity to strengthen our way of banking, accompanying economic growth in terms of sustainability and inclusion, beginning with how we organize the work of our people. The experience of social distancing can accelerate the development of ways of working that give greater reward to professionalism, leaving more space for personal and family development.
The Coronavirus pandemic has highlighted the need for incisive actions, not just in the healthcare sector. The interruption of supply chains between countries and continents has highlighted a fragility that will have to be addressed and resolved. Furthermore, the time lag between the pandemic curves of different geographic areas entails a misalignment of recoveries, and at least a temporary shift of the flows of international trade. The spatial distribution of economic activities will change. Italian companies will be able to leverage their faster adaptability. Intesa Sanpaolo will assist them, with the strength of its international and intercontinental networks.
The pandemic has also dramatically demonstrated that humankind does not have control of the planet: a fact that requires increased attention to issues of environmental sustainability. We need new knowledge, and new technologies, to develop new economic systems that are both environmentally and socially sustainable. Intesa Sanpaolo is deeply convinced of this and is among the leading companies in the world in terms of actions taken to favor sustainability and the circular economy. The Group also invests in innovation, both with its own Innovation Center, and through direct and indirect participation in an ever-increasing number of start-ups.
Social sustainability is at the center of the objectives that Intesa Sanpaolo pursues, offering savings protection and investment services, together with tools to protect people and their assets from myriad risks. The Group’s actions are aimed at satisfying the most important needs of the social system, with a diversified, balanced, flexible and resilient business model, which makes Intesa Sanpaolo a top bank in Europe in terms of solidity and efficiency.
Intesa Sanpaolo also leads in Europe in terms of shareholder remuneration. However, we deemed it appropriate to accept the ECB's request, proposing to the Ordinary Shareholders' Meeting to postpone the distribution of the dividend for 2019, although it is amply covered by the profits achieved and by the Bank's capital endowment. We shall reconsider the opportunity after 1 October 2020, as indicated by the Supervisor.
We are pleased by the support that shareholders have shown today for the Bank’s strategies and projects. This gives us yet another reason to face the challenges ahead with even greater conviction.
The 2019 financial statements approved today underline the significant results we have achieved, delivering on all our commitments and generating benefits for all our stakeholders. Net income of €4.2 billion is the highest in the last 11 years, while our capital levels and risk profile place us at the top of the sector in Europe.
In this phase of exceptional emergency, we decided to act on the indications from supervisory authorities, thereby reexamining the distribution of the originally-planned dividend in a new Shareholders' Meeting to be convened after October 1st.
With excess capital of around €19 billion above regulatory requirements, Intesa Sanpaolo is among those banks best positioned in the coming months to recommence shareholder remuneration in a substantial and sustainable manner. Sizeable dividends are an important contribution for retail shareholders in the context of the pandemic, and a crucial support to the 26 charitable foundations that are shareholders in favor of their respective community initiatives.
As the leading bank in Italy, we are the engine of the country's sustainable and inclusive growth.
Intesa Sanpaolo is a benchmark in providing credit to families and businesses during the COVID-19 emergency. With loans to customers totaling €450 billion euro – equal to 25% of GDP – new lending in March alone increased the stock of loans by €5 billion. Medium- and long-term lending to support Italian families and businesses totaled €14 billion in the first three months of the year.
From the earliest stages of Italy’s COVID-19 emergency, we instituted a suspension of mortgage and loan payments for families and businesses. At the same time, we made up to €15 billion in new credit available, which we increased to €50 billion following the government’s Liquidity Decree.
We stand alongside Italy’s businesses, which are doing extraordinary work. We are certain that the strength of our industry, its ability to export and its leadership position in a wide range of sectors – if properly supported – will be a formidable driver of the recovery.
Thanks to the support of our shareholders, we will pursue the exchange offer for UBI Banca with even greater conviction. It’s an operation that gains strategic value in the context of the COVID-19 pandemic. And for UBI Banca, the outlook is even more significant: high levels of capital, robust coverage of impaired loans, scale, diversification and investment capacity take on even greater value now.
The operation will go forward if acceptance of the offer represents 50% plus one share of UBI Banca’s capital.
The creation of an Italian champion – not to mention a European leader, thanks to its position as the 7th eurozone bank by operating income – will generate additional benefits for all stakeholders and for the regions that matter most to UBI, representing a solid contribution to the real and social economies of Italy.
It will provide an additional €10 billion of credit per year and no existing credit lines will be revoked.
We will guarantee the enhancement of UBI employees, who will retain full autonomy in providing credit locally. We will reinforce these areas by hiring 2,500 young workers, while exits will only be on a voluntary basis, as Intesa Sanpaolo has always done with its people.
To the regions in which UBI operates and where so many of its shareholders reside, we will bring our ability to remunerate shareholders in a significant and sustainable way. Over the past five years, we have distributed dividends totaling some €13.5 billion, without considering the €3.4 billion in dividends for 2019, whose distribution has been suspended until October on the basis of ECB recommendations for COVID-19.
In this emergency situation, we donated €100 million to the Italian national healthcare service along with donations to many other projects, such as to the Giovanni XXIII Hospital and for the Diocese of Bergamo – by far the city hit hardest by the health crisis – and soon for significant initiatives for the city of Brescia. Our Fund for Charity is supporting COVID-19 medical research. We aim to strengthen our program to support families in need with the distribution of meals, medicines, clothing and bed places, to help fight the prospect of inequality and social crisis.
The results achieved by our Group and its ability to overcome these challenges are based on our main element of strength: the competence and commitment of the people who work at Intesa Sanpaolo. They are the ones who make the Bank's success, and their professional contribution to the country is of particular importance, during this extraordinary emergency which we hope to overcome together to return to growth.
Click here for more about Intesa Sanpaolo’s COVID-19 initiatives to help Italy’s families and businesses.
Last updated 27 April 2020 at 18:54:51