BANCO DI DESIO E DELLA BRIANZA S.P.A. PRESS RELEASE
BANCO DESIO: CONSOLIDATED RESULTS AS AT 31 March 2023
Consolidated net profit for the first quarter of Euro 158.5 mln (annualised ROE at 20.6%), up on the same period of 2022 (+381.2%), supported by extraordinary items of Euro 133.1 mln (gross badwill of Euro 51.1 mln1 from the branches acquired from BPER and gross income of Euro 98.5 mln from the acquiring branch sold)
Solid operating performance supported by growth in income (+6.1%) with net interest income (+20.2% ) and net commission (+6.7%) growing; operating profit of Euro 57,5 mln in further improvement compared to Q1 2022 (+3.3%)
Cost income ratio (60.8%) and NPL ratio (3.4%) stable
Capital solidity and asset quality confirmed
Desio, 9 May 2023 - The Board of Directors of Banco di Desio e della Brianza S.p.A. approved the "Consolidated Quarterly Financial Report as at 31 March 2023". The main income statement and balance sheet indicators for the period are summarised in the table below.
PROFITABILITY
GROWTH
ASSET QUALITY
CAPITAL SOUNDNESS3
- Net growth in consolidated net profit to Euro 158.5 million (+381.2% compared to Q1 2022)
- Increased profitability (annualised ROE at 20.6%) with stable operating expenses and cost of risk under control
- Improved operations (+3.3%) due to growth in income (+6.1%)
- Positive economic contribution from the 48 new branches acquired by BPER consolidated for 40 days (from 20 february 2023)
- Cost/income ratio of 60.8% (60.3% in Q1 2022)
- Net interest income +20.2%
- Net commissions +6.7%, due to the positive contribution of payment service revenues
- Loans to ordinary customers at Euro 12.4 billion (+7.6% at 31 december 2022) with additional disbursements to households and businesses during the reporting period amounting to Euro 0.4 billion
- Direct deposits increased to Euro 14.1 billion (+11.8%)2
- Indirect deposits of Euro 19.2 billion (+12.6%, of which ordinary customers up 18.4%)
- Stable incidence of non-performing loans: Gross NPL ratio at 3.4% (3.3% at 31 december 2022) and net at 1.8%
- Rigorous credit assessment and solid coverage levels on non-performing loans at 48.1% and on performing loans at 0.90% (the coverage of non-performing loan net of public guarantees is equal to 52.1%)
- Liquidity under control with LCR indicator at 188.18%
Banco Desio Group's capital solidity confirmed | |||
Ratios4 | Banco Desio Brianza | Banco Desio Group | Brianza Unione Group5 |
CET 1 | 16.97% | 15.75% | 11.42% |
TIER 1 | 16.97% | 15.75% | 12.24% |
Total Capital | 16.97% | 15.75% | 13.30% |
- As a results of the provisional Purchase Price Allocation (PPA) process carried out for this Interim Financial Report.
-
Including funding repurchase agreements with institutional customers in the amount of Euro 1,266 million (Euro 503 million at 31 december 2022).
3 On the basis of the Bank of Italy's provision communicated to Banco di Desio e della Brianza S.p.A. and to the financial parent company Brianza Unione di Luigi Gavazzi e Stefano Lado S.A.p.A., on 18 may 2022, the "CRR" Brianza Unione Group was assigned the following minimum capital requirements to be complied with upon completion of the Supervisory Review and Evaluation Process (SREP): CET1 ratio of 7.35%, binding - pursuant to Art. 67-ter of the Consolidated Law on Banking - to the extent of 4.85% (of which 4.50% for minimum regulatory requirements and 0.35% for additional requirements) and the remainder from the capital conservation buffer component, Tier1 ratio of 9.00%, binding to the extent of 6.50% (of which 6.00% for minimum regulatory requirements and 0.50% for additional requirements) and the remainder from the capital conservation buffer component, Total Capital ratio of 11.15%, binding at 8.65% (of which 8.00% for minimum regulatory requirements and 0.65% for additional requirements) and the remainder from the capital conservation buffer component.
4 Pursuant to the transitional provisions introduced by Regulation (EU) 2017/2395 of 12 december 2017 as amended.
5 The consolidated ratios at the level of Brianza Unione di Luigi Gavazzi e Stefano Lado S.A.p.A., the parent company of 50.41% of Banco di Desio e della Brianza S.p.A., were calculated in accordance with the provisions of Articles 11(2) and (3) and 13(2) of the CRR Regulation.
Consolidated Quarterly Financial Report as at 31 march 2023 | Page 1
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The Board of Directors of Banco di Desio e della Brianza S.p.A., which met on 9 may 2023, approved the "Consolidated Quarterly Financial Report as at 31 march 2023" (hereinafter also the "Report"), prepared on a voluntary basis.
The Report was also prepared for the purposes of determining the result for the period for the calculation of own funds and prudential ratios.
As far as the recognition and measurement criteria are concerned, the Report is prepared in accordance with the IAS/IFRS in force at the reporting date, as shown below in the section "Basis of Preparation".
Please refer to the specific disclosure dedicated to the description of the reference context in which this financial disclosure was prepared, which is conditioned by the conflict between Russia and Ukraine, as well as the significant uncertainties and risks related to this, which may also have a major impact on the expected results that are linked to a number factors beyond management's control.
The amounts in the tables and charts of the Report are expressed in thousands.
The financial statements in this Report are subject to a limited audit by KPMG S.p.A. for the inclusion of the interim result in equity.
Consolidated Quarterly Financial Report as at 31 march 2023 | Page 2
Information on the impacts of the war in Ukraine
The conflict between Russia and Ukraine, which began at the end of february 2022, seems destined to last over time, bringing with it negative political and economic consequences that constitute a significant element of uncertainty for the future scenarios described in the "Macroeconomic Scenario" disclosure below.
Monitoring activities continued on customer borrowers: the analysis of positions revealed a limited deterioration of outstanding credit lines, on which actions were taken to contain and manage the risk. Monitoring the indirectly most exposed positions is one of the main areas of attention in order to ensure the best quality of the credit portfolio over time and, at the same time, to identify the best solutions to enable companies to continue their business.
In continuity with the actions taken in the Covid context, the Bank adopted the Temporary Crisis Framework (TCF) that will allow SMEs to apply for access to MCC-guaranteed financing to address liquidity needs related to the economic and financial turmoil caused by the ongoing conflict.
Consolidated Quarterly Financial Report as at 31 march 2023 | Page 3
Results of the period
Summary data and balance sheet, income statement and financial ratios
The alternative performance indicators (APIs) presented in this Report have been identified to facilitate understanding of Banco Desio's performance. APIs are not required by international accounting standards, represent supplementary information with respect to the measures defined under IAS/IFRS, and are in no way a substitute for them.
For each API, evidence of the calculation formula is provided, and the quantities used can be inferred from the information contained in the relevant tables and/or reclassified financial statements contained in this Report.
These indicators are based on the European Securities and Markets Authority (ESMA) guidelines of 5 October 2015 (ESMA/2015/1415), incorporated in Consob Communication No. 0092543 of 3 december 2015. Adhering to the indications contained in the update of document "ESMA 32-51-370 - Questions and answers - ESMA Guidelines on Alternative Performance Measures (APMs)", published on 17 april 2020, no changes were made to the APIs and no new ad hoc indicators were introduced to separately highlight the effects resulting from the outbreak of Covid-19 or the conflict in Ukraine.
Table 1 - Asset values
31.03.2023 | 31.12.2022 | Changes | ||
Amounts in Euro thousands | abs. | % | ||
Total assets | 19,805,036 | 17,541,324 | 2,263,712 | 12.9% |
Financial assets | 3,993,251 | 4,018,411 | -25,160 | -0.6% |
Loans to banks (1) | 426,391 | 260,167 | 166,224 | 63.9% |
Loans to customers (1) | 12,353,729 | 11,480,616 | 873,113 | 7.6% |
Tangible assets (2) | 228,270 | 220,934 | 7,336 | 3.3% |
Intangible assets | 20,121 | 19,963 | 158 | 0.8% |
Non-current assets and groups of assets held for sale | 0 | 1 | -1 | -100.0% |
Payables to banks | 3,632,989 | 3,381,350 | 251,639 | 7.4% |
Payables to customers (3) (4) | 12,553,468 | 11,110,366 | 1,443,102 | 13.0% |
Securities issued | 1,581,214 | 1,536,151 | 45,063 | 2.9% |
Equity (including Profit for the period) | 1,287,371 | 1,122,454 | 164,917 | 14.7% |
Own Funds | 1,247,871 | 1,132,852 | 115,019 | 10.2% |
Total indirect inflows | 19,232,287 | 17,082,615 | 2,149,672 | 12.6% |
of which Indirect inflows from ordinary customers | 12,004,320 | 10,135,327 | 1,868,993 | 18.4% |
of which Indirect inflows from institutional customers | 7,227,967 | 6,947,288 | 280,679 | 4.0% |
( 1) pursuant to Circular 262, the balanc e of the financial statements item includes Held- to- collec t (HTC) debt sec urities recognised at amortised c ost, whic h are shown under financ ial assets in these summaries, and does not include current acc ounts and demand deposits recognised under Cash. At 31 March 2023, Cash also inc luded the amount on demand of Euro 2.0 million relating to cash in excess of the commitment to maintain the compulsory reserve, invested in overnight deposits (Euro 765 million at the end of the previous period).
( 2) the balance of the item at 31March 2023 includes the right of use (RoU Asset) amounting to Euro 61.5 million in respect of operating leases falling under the scope of IFRS 16 Leases, which came into effect as of 1 January 2019.
( 3) the balance of the item does not include the liability recognised in the item Payables to customers in the financial statements in respect of operating leases falling within the scope of IFRS 16.
( 4) including inflows repurchase agreements with institutional customers in the amount of Euro 1,266 million (Euro 503 million at 31 December 2022).
Table 2 - Economic values (5)
31.03.2023 | 31.03.2022 | Changes | ||
Amounts in Euro thousands | abs. | % | ||
Operating income | 129,395 | 121,982 | 7,413 | 6.1% |
of which Net interest income | 78,072 | 64,958 | 13,114 | 20.2% |
Operating expenses | 71,906 | 66,313 | 5,593 | 8.4% |
Result from operations | 57,489 | 55,669 | 1,820 | 3.3% |
Charges related to the banking system | 6,780 | 7,260 | -480 | -6.6% |
Current result after taxes | 25,376 | 24,739 | 637 | 2.6% |
Non-recurring result after taxes | 133,110 | 8,194 | 124,916 | n.s. |
Profit (loss) for the period | 158,486 | 32,933 | 125,553 | 381.2% |
(5) from Reclassified Income Statement .
Consolidated Quarterly Financial Report as at 31 march 2023 | Page 4
Table 3 - Equity, economic and risk ratios
31.03.2023 | 31.12.2022 | Changes | |
abs. | |||
Equity/Total assets | 6.5% | 6.4% | 0.1% |
Equity/Loans to customers | 10.4% | 9.8% | 0.6% |
Equity/Payables to customers | 10.3% | 10.1% | 0.2% |
Equity/Securities issued | 81.4% | 73.1% | 8.3% |
Common Equity Tier1 (CET1) capital/Risk-weighted assets (Common Equity Tier1) (6) (7) | 15.7% | 14.8% | 0.9% |
Total Tier 1 (T1) capital/Risk-weighted assets (Tier1) (6) (7) | 15.7% | 14.8% | 0.9% |
Total Own Funds/Risk-weighted assets (Total capital ratio) (6) (7) | 15.7% | 14.8% | 0.9% |
Financial assets/Total assets | 20.2% | 22.9% | -2.7% |
Loans to banks/Total assets | 2.2% | 1.5% | 0.7% |
Loans to customers/Total assets | 62.4% | 65.4% | -3.0% |
Loans to customers/Direct inflows from customers | 87.4% | 90.8% | -3.4% |
Payables to banks/Total assets | 18.3% | 19.3% | -1.0% |
Payables to customers/Total assets | 63.4% | 63.3% | 0.1% |
Securities issued/Total assets | 8.0% | 8.8% | -0.8% |
Direct inflows from customers/Total assets | 71.4% | 72.1% | -0.7% |
31.03.2023 | 31.03.2022 | Changes | |
abs. | |||
Operating expenses/Operating income (Cost/Income ratio) | 55.6% | 54.4% | 1.2% |
(Operating expenses + Banking-related expenses)/Operating income (Cost/Income ratio) | 60.8% | 60.3% | 0.5% |
Net interest income/Operating income | 60.3% | 53.3% | 7.0% |
Result from operations/Operating income | 44.4% | 45.6% | -1.2% |
Current result after taxes/Equity - annualised (8) (9) | 8.8% | 8.7% | 0.1% |
Profit for the year/Equity (8) (R.O.E.) - annualised (9) (10) | 20.6% | 7.8% | 12.8% |
Current result before taxes/Total assets (R.O.A.) - annualised (10) | 0.7% | 0.8% | -0.1% |
31.03.2023 | 31.12.2022 | Changes | |
abs. | |||
Net bad loans/Loans to customers | 0.5% | 0.5% | 0.0% |
Net non-performing loans/Loans to customers | 1.8% | 1.7% | 0.1% |
% Cov erage of bad loans | 68.0% | 67.3% | 0.7% |
% Cov erage of bad loans before write-offs | 68.3% | 67.6% | 0.7% |
% Total cov erage of non-performing loans | 48.1% | 49.6% | -1.5% |
% Cov erage of non-performing loans before write-offs | 48.3% | 49.9% | -1.6% |
% Cov erage of performing loans | 0.90% | 0.88% | 0.02% |
Table 4 - Structure and productivity data
31.03.2023 | 31.12.2022 | Changes | ||
abs. | % | |||
Number of employees | 2,398 | 2,115 | 283 | 13.4% |
Number of branches | 280 | 232 | 48 | 20.7% |
Amounts in Euro thousands | ||||
Loans to customers per employee (11) | 5,475 | 5,395 | 80 | 1.5% |
Direct inflows from customers per employee (11) | 6,264 | 5,943 | 321 | 5.4% |
31.03.2023 | 31.03.2022 | Changes | ||
abs. | % | |||
Operating income per employee (11) - annualised (9) | 228 | 228 | 0 | 0.0% |
Result from operations per employee (11) - annualised (9) | 101 | 100 | 1 | 1.0% |
- Consolidated equity ratios calculated for Banco Desio. The ratios referred to the prudential supervisory scope of Brianza Unione at 31 March 2023 are: Common Equity Tier1 11.4%; Tier 1 12.2%; Total Capital Ratio 13.3%.
- Equity ratios at 31.03.2023 are calculated in application of the transitional provisions introduced by EU Regulation 2017/2395; ratios calculated without application of these provisions are as follows: Common Equity Tier1 15.5%; Tier 1 15.5%; Total capital ratio 15.5%
- net of the result for the period.
- the 2022 year-end figure at 31.03.2022 is shown.
- the annualised ROE at 31.03.2023 does not consider the annualisation of the non-recurring Net Operating Income.
- based on the number of employees as the arithmetic mean between the period-end figure and the previous year-end figure.
Consolidated Quarterly Financial Report as at 31 march 2023 | Page 5
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Banco di Desio e della Brianza S.p.A. published this content on 17 May 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 May 2023 10:20:09 UTC.
