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UniCredit profit rises in 2021

Reinforced partnership with German insurance giant Allianz

28 January, 12:44
(ANSA-AFP) - MILAN, JAN 28 - UniCredit, Italy's second biggest bank, announced Friday a net profit of 1.54 billion euros in 2021, after a loss of 2.78 billion euros in 2020 as coronavirus ravaged the global economy. Underpinned by a strong increase in commissions, the result is however lower than analysts' expectations provided by the bank, which forecast a net profit of 1.83 billion euros, while UniCredit's accounts went back into the red in the fourth quarter. Chief executive Andrea Orcel nevertheless confirmed his ambitious target to return to shareholders at least 16 billion euros by 2024. In total, 3.75 billion euros will be distributed to shareholders on the back of the 2021 results, through dividends of 1.17 billion euros and a share buyback of 2.58 billion euros. For 2022, Orcel confirmed a forecast of "more than 3.3 billion euros" in net profit. Last year's figures fell short of forecasts due to restructuring costs linked to a new strategic plan that weighed on the fourth quarter, where a net loss of 1.43 billion euros was recorded. This loss was larger than the analysts' consensus, which predicted some 1.14 billion euros. However, underlying net profit -- excluding exceptional items -- still tripled to 3.9 billion euros in 2021, above the group's target of 3.7 billion.

Turnover was also higher than expected, rising by 4.8 percent year on year to 17.9 billion euros. Orcel, who took over last April from Jean-Pierre Mustier, announced a new strategic plan in December that forecast net profit of more than 4.5 billion euros in 2024. His priorities include the "simplification" of the group, and on Thursday announced a deal with trade unions for 1,200 voluntary exits, 725 new hires and 1,000 permanent contracts between now and 2024. Meanwhile, UniCredit announced Friday it had signed a deal to reinforce its partnership with German insurance giant Allianz, notably for joint investments in digitisation in Italy, Germany, central and western Europe.

UniCredit is seeking a new approach following the failure of its negotiations with Italy's government over the mooted purchase of Banca Monte dei Paschi di Siena (BMPS). (ANSA-AFP).

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