Founded in 2017 through the merger of Banco Popolare and Banca Popolare di Milano, Banco BPM has established itself as Italy’s third-largest banking group. With a strong presence in northern Italy, the bank offers a comprehensive range of financial services, including retail banking, asset management, and insurance.
Recent Financial Performance
In the third quarter of 2024, Banco BPM reported a net profit of €945.7 million, a significant increase from €319 million in the same period last year. This performance reflects effective cost management and rising interest income, supported by a favorable rate environment.
For the first nine months of 2024, net profit totaled €1,695.8 million, exceeding the €943.4 million recorded during the same period in 2023. This solid growth demonstrates the bank's resilience to economic challenges and its ability to deliver substantial profits.
Corporate Strategy and Recent Initiatives
Banco BPM continues to focus on organic growth and improving profitability. In August 2024, the bank raised its 2024 earnings per share forecast to €0.95, up from the previous estimate of €0.90, and increased its interim dividend plan to €600 million. The bank aims to exceed its shareholder remuneration target of €4 billion during the 2023–2026 period.
In November 2024, Banco BPM launched a €1.6 billion public acquisition offer for Anima Holding, an Italian asset manager. This acquisition seeks to diversify the bank’s revenue streams and strengthen its position in the asset management sector.
Competitive Landscape and Takeover Offers
The Italian banking sector is undergoing significant consolidation. In November 2024, UniCredit launched a €10.1 billion public offer to acquire Banco BPM, proposing 0.175 new UniCredit shares for each Banco BPM share, valuing the latter at €6.657 per share. However, Banco BPM’s board rejected the offer, deeming it hostile and undervaluing the bank’s true worth.
At the same time, Crédit Agricole increased its stake in Banco BPM from 9.9% to 15.1%, signaling its strategic interest in the Italian banking market. Crédit Agricole has sought approval to raise its holding to 19.99%, complicating UniCredit’s acquisition attempts.
Future Outlook and Potential Merger with Monte dei Paschi di Siena
Banco BPM remains focused on its 2023–2026 business plan, targeting a net profit exceeding €1.5 billion by 2026, compared to €1.2 billion in 2023, and a tangible return on equity (ROTE) of 13.5% in 2026, up from 12% in 2023. The bank is strengthening its market position by consolidating its asset management operations and exploring both organic and external growth opportunities.
The Italian government has expressed support for a potential merger between Banco BPM and Monte dei Paschi di Siena (MPS), aiming to create a third major national banking group. This strategy seeks to stabilize the Italian banking sector and provide a competitive alternative to UniCredit and Intesa Sanpaolo.
In November 2024, the Italian state reduced its stake in MPS from 15% to 11.7%, enabling Banco BPM to acquire a 5% stake and Anima Holding to purchase 3%. This strategic move aligns the interests of Banco BPM and MPS, paving the way for a potential merger.
However, the competing takeover bids from UniCredit and Crédit Agricole complicate this scenario. The Italian government, mindful of national interests, has indicated a willingness to use its "golden powers" to intervene if a merger or acquisition involving Banco BPM undermines strategic objectives. These powers allow the government to impose conditions or block deals in key sectors, including banking.
In conclusion, Banco BPM demonstrates robust financial performance and resilience in navigating a complex competitive landscape. The potential merger with Monte dei Paschi di Siena represents a strategic opportunity to strengthen its market position, although challenges persist due to competing offers and potential government interventions.
You will find in the attachment to this article the presentation file of Banco BPM.
Comentarios