Profit, net of PPA and real estate gains, has grown sixfold on 2020 and is 10% higher than in 2019. The result was achieved despite the prudential interventions within the scope of the COVID-19 pandemic on concentration risk, vintage and Npl portfolio acquired, and the incurring of costs related to the transfer and consequent regulatory deconsolidation of the registered office of the Holding company La Scogliera. In 2021, an all-time record was achieved in terms of revenues (602,5 million Euro), cash recoveries of purchased Npl portfolios (345 million Euro) and purchases of Npl portfolios (3,7 billion Euro).
Moody’s has assigned Banca Ifis a rating of Baa3 (investment grade) with a stable outlook due to the Bank’s profitability and solid capital and liquidity position.
For FY 2021, the Board of Directors proposes that the Shareholders’ Meeting distribute a dividend of 0,95 Euro per share, equal to twice the coupon for FY 2020. Payment is expected for May 2022.
Preliminary period results
Reclassified data (1) – 1 January 2021/31 December 2021
- Net banking income is up 28,8% to 602,5 million Euro (467,8 million Euro at 31.12.2020) and benefited from the improved performance of the Npl Segment of 257,6 million Euro (+94,6 million Euro compared to 31.12.2020) and higher revenues from the Commercial & Corporate Banking Segment of 283,2 million Euro (+60,5 million Euro compared to 31.12.2020).
- Operating costs amounted to 375,5 million Euro (+21,9% compared to 308,0 million Euro as at 31.12.2020), due to higher variable costs related to legal activities and Npl recovery, to the inclusion of Farbanca and the former Aigis Banca in the scope of consolidation, to ICT projects, to higher costs for variable remuneration of employees and one-off items related to the transfer of the registered office of the Holding company La Scogliera.
- The net profit attributable to the Parent Company of 100,6 million Euro recorded double-digit growth (+46,2%) compared to 68,8 million Euro in 2020. Excluding the PPA and the gain of 24,2 million Euro from the sale of the property in Corso Venezia in Milan in 2020, the result was six times that of 2020 and 10% higher than 2019.
- Cost of credit of 77,2 million Euro (down from 91,4 million Euro in 2020), which includes additional provisions of an additional 18 million Euro in the Npl portfolio for long-term effects related to COVID-19, 12,5 million Euro for concentration risk, and 12,0 million Euro for positions in the commercial portfolio with high vintage.
- CET1 at 15,44% is among the best in the market and gives stability to the dividend payout.
- Solid liquidity position: approximately 960 million Euro at 31 December 2021 in reserves and free assets that can be financed by the ECB (LCR above 900%).
Capital requirements
- CET1 up to 15,44% (11,29% at 31 December 2020) with respect to an SREP requirement of 8,12%; TCR: 19,63% (14,85% at 31 December 2020) with respect to an SREP requirement of 12,5%. The significant increase in shareholders’ equity compared to 31 December 2020 is mainly due to the transfer of the registered office of the Holding company La Scogliera to the Canton of Vaud (Lausanne – CH) – in connection with personal reasons of the Chairman. The effectiveness of the resolution passed by the extraordinary shareholders’ meeting of the parent company to transfer the registered office, as from 27 December 2021, has in fact allowed the elimination of La Scogliera from the regulatory consolidation of the Bank, with consequent full appreciation of the Group’s equity.
Milan, 10 February 2022 – The Board of Directors of Banca Ifis, chaired by the Deputy Chairman, Ernesto Fürstenberg Fassio, has approved the preliminary results for 2021. The draft 2021 financial statements will be approved on 10 March 2022.
“In 2021 we were able to seize the opportunities offered by the economic recovery, creating the basis for the 2022-24 Business Plan – explains Frederik Geertman, CEO of Banca Ifis – Parent Company profit stood at 100,6 million Euro, up 46,2%, and is higher than the guidance we had revised upwards in November and estimated at between 90 and 100 million Euro. The result which, calculated net of PPA, amounted to 85 million Euro was up 10% on 2019 and was supported by the excellent performance of all the Bank’s business units. Revenues of 602,5 million Euro reached an all-time high led by recurring components.
The effectiveness of the resolution to transfer the registered office of La Scogliera to the Canton of Vaud (Lausanne – CH), which took place on 27 December 2021, has made it possible to optimise the Group’s capital structure from a regulatory point of view (eliminating, already with effect from FY 2021, the consequences deriving from the prudential consolidation of the Parent Company), while confirming, at the same time, the focus on long-term growth of the controlling shareholder. The CET1 at 31 December 2021 thus stands at 15,44% and supports the stability of the dividend policy. With reference to FY 2021, the Board of Directors proposes that the Shareholders’ Meeting pay a dividend of 0,95 Euro per share, corresponding to a payout ratio of 50,5% and equal to double the coupon distributed in 2021 against FY 2020 (0,47 Euro per share).
In the Npl Segment, in 2021 we exceeded our targets by acquiring over 3,7 billion Euro of non-performing loans, confirming our position as market leader in small ticket unsecured loans, with a market share of 46%. Period purchases will make a solid contribution to the Bank’s profitability in the coming years. Cash recoveries on Npl portfolios acquired reached an all-time high and amounted to 345 million Euro (+33% compared to 259 million Euro in 2020) confirming the portfolio’s quality.
In the Commercial & Corporate Banking Segment, we continued the process of the digitisation and development of services from an omnichannel perspective with the implementation of the “Ifis4business” platform, which will be extended to all products in the portfolio within this year. We have also entered into partnerships with other institutions in order to increase the distribution capacity of the Bank’s products and services without increasing fixed costs.
In addition, we have initiated projects aimed at improving the Bank’s efficiency, such as the creation of a new centralised procurement function for contract negotiation and supplier selection and cost optimisation.
With a view to prudence, in 2021 we made adjustments to loans of 18 million Euro in the Npl portfolio for the long-term effects related to COVID-19, 12,5 million Euro on trade receivables for concentration risk and 12,0 million Euro on positions with high vintage.
In the ESG area, in 2021, we reinforced our distinctive positioning towards a more sustainable and inclusive future, also thanks to the establishment of the Sustainability Committee. Banca Ifis was the first Italian challenger bank to adhere to the Net-Zero Banking Alliance: we committed, within 18 months of signing up, to defining targets for reducing emissions by 2030 and zeroing those of the entire portfolio by 2050. Banca Ifis has also – and it is the first institution in Italy – been certified for gender equality by the “Winning Women Institute,” concludes Geertman.
(1) In the following statements, net impairment losses/reversals on receivables of the Npl Segment were reclassified to interest receivable and similar income to the extent to which they represent the operations of this business and are an integral part of the return on the investment. For this reason too, apart from the specific operations, the effects of an analysis performed also in response to the Covid-19 pandemic have been classified amongst value adjustments.
