BPER Banca (BPE) CMD 2024 summary

Strategic vision and business model

• Aims to be a leading banking and wealth management player in Italy, serving ~5 million clients and managing €300bn in total financial assets, ranking 3rd by customers and assets.

• Pursues growth through organic expansion and integration of acquired banks, achieving economies of scale and a unique value creation platform.

• Focuses on a complete product offering, innovation, and a flexible, client-centric approach leveraging a strong territorial franchise.

• Maintains a conservative risk profile with strong asset quality, CET1 ratio above 14.5%, and NPE ratios at historical lows.

• Emphasizes ESG leadership, digital transformation, and workforce upskilling as core pillars for modernization.

Strategic priorities and business plan targets

• Four main priorities: boost commission-intensive products, increase productivity and reduce costs, modernize credit risk and capital management, and complete bank modernization, with full operationalization by H1 2025.

• Revenue growth driven by higher commissions (+€550m) and commercial volumes, offsetting lower interest rates and Ecobonus impact; commission share of revenues to rise from 38% to 42%.

• Operating costs (excl. D&A) to decrease by 7%, improving cost/income ratio from ~52% to 50%.

• Net income to grow from ~€1.3bn to €1.5bn, with RoTE above 16% and CET1 ratio maintained above 14.5%.

• Cumulative net earnings of €4.3bn and sustainable 75% payout ratio, yielding €3.2bn in dividends (2025–2027) and >15% dividend yield.

Financial targets and guidance (2024–2027)

• Total revenues targeted to grow from ~€5.4bn in 2024 to ~€5.5bn in 2027 (+0.5% CAGR), with net commission income rising 12% (+3.8% CAGR) and net interest income declining 5% (-1.8% CAGR).

• Net customer loans to grow from ~€88bn to ~€97bn (+3% CAGR), and total financial assets from ~€297bn to ~€323bn (+3% CAGR).

• Committed to a ~75% dividend payout ratio for 2025–2027, targeting >15% dividend yield p.a. and €3.2bn distribution.

• Net income expected to increase by 15% (+5% CAGR) to ~€1.5bn, with ROTE above 16% and CET1 ratio stable above 14.5%.

• Operating costs (excl. D&A) to decrease by 7% (-2.3% CAGR), driving cost/income ratio down to ~50% by 2027.