First two months of the year in line with Business Plan targets
Solid financial position with an increase in CET1 ratio to 11,12% and liquidity of 1,4 billion Euro
Swift, incisive response to Covid-19
Safety and protection of health: 93% of personnel working remotely
Support for SMEs: +5% new customers acquired during the lockdown
Investments: acceleration on digital and IT platforms
First quarter 2020 results
RECLASSIFIED DATA: 1 January – 31 March
– Net profit for the period in the first quarter of 2020 26,4 million Euro;
– Net banking income 106,0 million Euro;
– Operating costs down to 73,5 million Euro;
Capital requirements with the consolidation within La Scogliera:
– CET1: 11,12% (10,96% at 31 December 2019) versus an SREP requirement of 8,12%; TCR: 14,80% (14,58% at 31 December 2019) versus an SREP requirement of 12,5%.
Capital requirements without the consolidation within La Scogliera:
– CET1: 14,59% (14,28% at 31 December 2019); TCR: 19,07% (18,64% at 31 December 2019).
Response to Covid-19
– Employees: 93% of personnel working remotely; high safety standards in the workplace; extension of health insurance to also cover Covid-19.
– Corporate customers: efficient, uninterrupted service ensured; digitalisation processes for remote customer management expedited: over 300 new customers acquired via digital channels during the lockdown period (+5%). 18,300 deferrals approved.
– NPL business: 65 million Euro collected (57 million Euro in 1Q2019), confirming that the Bank offers its customers repayment plans that are sustainable over the long term. Active participation in new portfolio sales processes.
2020-2022 Business Plan: financial performance and position targets suspended
Mestre (Venice), 12 May 2020 – The Board of Directors of Banca Ifis met today, chaired by Deputy Chairman Ernesto Fürstenberg Fassio, and approved the results for the first quarter of 2020.
“We are facing a complex time, an unforeseen global crisis, to which we have responded swiftly and efficiently. Banca Ifis promptly implemented incisive measures to protect the health and safety of its employees and customers, while also ensuring full operations: in around ten days, 93% of our people began to work remotely, and the Company continued its business in accordance with all regulations,” explained Luciano Colombini, Chief Executive Officer of Banca Ifis.
“The financial impacts of the Covid-19 pandemic are clearly characterised by a high level of uncertainty, but the Group’s financial performance and financial position are solid and enable the Bank to face the current financial crisis with confidence: at 31 March we had increased our CET1 ratio to 11,12% (+0,16% on 31 December 2019) and available liquidity amounted to approximately 1,4 billion Euro.
The results for the first quarter were affected by Covid-19, although the first two months of the year were in line with the targets set in the Business Plan. Several transactions were completed during the period, such as the closing of the sale of the property on Corso Venezia in Milan, which generated a capital gain of 24 million Euro, and the successful placement of a senior bond of 400 million Euro as part of the strategy of diversifying funding sources. The corporate and organisational restructuring of the NPL business and the work to build an IT platform in support of small and medium enterprises were launched on schedule.
In March, when the spread of the pandemic resulted in the closure of many businesses and severely limited the movement of individuals, we used every means at our disposal to rise to this challenge and manage the new situation as well as possible. We stepped up our digital transformation processes and in just a few weeks made a great technological leap forwards, testing out new working methods that allowed us to achieve important objectives, confirming the agility and dynamism of the Bank’s model.
We contacted over 5.000 customers and acquired approximately 300 of them, developing new products and services like loans for industrial conversions or expansion of production lines in response to the emergency. In addition, some sectors particularly affected by Covid-19 began to be closely monitored and covered. In just a few weeks we prepared a digital platform to streamline the process of granting new loans guaranteed by the government under the “Cure Italy” Decree.
We continued to invest in the non-performing loans market, taking an active part in unsecured NPL sales processes, and we enhanced our telephone recovery activity following the temporary suspension of operations by the agents network. In the future, we are confident that our ten years of experience in the sector will allow us to continue to make sound purchases. In addition, we foresee that the impact of the court closures will be temporary and will primarily be tied to longer payment times rather than to reduced payments. Banca Ifis offers its debtors sustainable long-term repayment plans with an average time to recovery of the portfolio of five to seven years.
In view of the exceptional nature of this situation, and given the uncertain course of the emergency and its impact in the coming months, on 1 April the Bank’s Board of Directors decided, in accordance with the prudence principle, to take the responsible course of action of following the supervisory authority’s recommendation and thus to propose that the distribution of the 2019 dividend be postponed until at least 1 October 2020, and thus to proceed with payment of the dividend after that date, provided that no regulations or recommendations from the supervisory authorities to the contrary are issued before that date. Banca Ifis has also decided to suspend the financial performance and position targets set in the 2020-2022 Business Plan, which will be revised and updated as soon as the macroeconomic situation stabilises.
The Board of Directors, supervisory bodies and the Company’s management continue constantly to monitor the course of the emergency caused by the spread of Covid-19 and to take the decisions and measures necessary to respond to it,” Luciano Colombini concluded.
