(Ticker) – “MPS is no longer a systemic problem but a real one assets of value for the country“. The Chief Executive Officer of the Sienese bank specified it today, Louis Lovaglioduring the conference call with analysts, after recalling that “it has passed a year since I had the honor of sitting in the front row in this bank, I did not think that after only 7 months from the launch of the plan I would find myself here presenting quarterly results with a profit of 156 million, a cost income of 60% and a core tier 1 of 15.6%”.
Lovaglio wanted to recall that last year he had anticipated that the fourth quarter would have been a “turning point” for the Rocca Salimbeni Institute, which now stands “in the middle of a rigorous and disciplined journey” which will lead it to achieve the targets set by the Business Plan.
Moving on to illustrate the main results for the quarter and for the year 2022, the CEO of MPS stated that the 156 million profit made in the 4th quarter “confirm the bank’s ability to generate sustainable returns and make up the springboard for next year“.
The cost of exodus (-925 million) instead had a impact on the result for the whole year which closed with a loss (-205 million), while excluding the cost of redundancies it would have brought out a profit of 720 million. The impact of voluntary exits – anticipated the manager – will attest to 300 million for 2023.
Operating profit of 333 million is up by 60% and – stated Lovaglio – “demonstrates that the bank is capable of generating sustainable results over time and from which the solidity of the bank and the strength of the network can be deduced”. The bank – he added – “is able to generate a solid operating result and therefore capital for the entire span of the plan”.
The CEO recalled that the results benefited from the growth in the interest margin, a result up 31.4% quarter on quarter and 54.5% year on year and for the year 2022 up 26% compared to 2021.
The number one of MPS wanted to recall that the NPE stock decreased by around 20% with a Gross NPE stock of 3.3 billion as at 31 December 2022 and an NPE ratio of 2.2%. The NPE coverage at 48.1% – he underlined – “demonstrates ours cautious approach“.
Speaking of judicial requestsLovaglio stated that there has been no change since Septemberwhile for requests extrajudicial, the manager recalled that most of the requests arrive in the run-up to the closing of the financial statements. In January MPS received a letter claiming damages for 700 million euros, compared to a total amount of 1.5 billion at the end of the year. The bank managed to manage this risk well and obtained – explained Lovaglio – two positive sentences at the beginning of 2023 which demonstrate the positive trend of previous years.
One year later – reads the slides – MPS is “a stronger, more efficient and profitable bank, well on the way to achieving the objectives of the Business Plan”. Lovaglio also supplied the guidance for 2023, indicating that an increase in the interest margin is expected, guaranteed by the increase in rates and by the commercial asset mix and a progressive reduction in costs, despite the high inflation scenario. “In line with the target, we have improved the quality of the assets – added the CEO – so we think that the cost of credit in 2023 should not exceed 2022 levels”. For pre-tax profit the target is 700 million by 2024 and “we are getting close to this target”.