23rd November 2020

After The Poor Half-yearly Figures, A Financial Statements For Popolare Di Vicenza

Banca Popolare di Vicenza recently published its half-yearly results following the 1.5 billion euro capitalization of the Atlas Fund, which was in fact rather snubbed by the markets.

The figure shows a worrying red of 795 million euro, which was certainly affected by adjustments to loans, litigation risks and the break-up with Cattolica Assicurazioni.

The failure to list on the stock exchange in May has also disappointed the expectations of many investors and now the Vicenza institute must find effective remedies to be able to look back with hope and determination to the coming months.

Few certainties but a lot of determination in the words of the president, who has certainly lost no time since he took office at the top of the bank: in the last 6 months in fact Mion has started an important cost reduction that has reduced operating expenses by 5.4%, bringing them to 321.6 million euros.

This result, however, was affected by adjustments of 938,8 million euro, in particular those following the conclusion of the relationship with the historic partner Cattolica Assicurazioni, which caused a write-down of the investment by more than 229,9 million euro out of a total of 310,8 million euro.

The disastrous result of €795 million in negative was in any case foreseeable and expected, and in relative improvement with respect to the €1.05 billion recorded in June last year, in turn due to the increase in the levels of credit coverage and the detachment from Cattolica Assicurazioni.

Now the bank seems determined to clean up and reorganize the company from the bottom up, already bringing home quite comforting numbers.

Iorio also points out that funding has recovered, from the end of May to the end of August we brought home 850 million euro, and the trend is constant.

The level of coverage of impaired loans, currently at 9.4 billion euro gross, rose to 46.2% with an increase of 3 percentage points compared to the end of a year.

In just 3 and a half years we made adjustments of 3.2 billion euro.

In the light of the accounts and the structural changes planned for the coming months, a new and more appropriate business plan will also be drawn up, which should be ready by the first half of October.

The plan should be based on three main drivers, namely the recovery of operational efficiency, the reduction of credit risk and the reconstruction of a relationship of trust with the territory. Positive news then, but there are still many issues to be resolved, first and foremost the rationalization of agencies and the workforce: suffice it to say that to date as many as 150 branches have been closed, of which 71 in 2016 alone, and there have been 550 redundancies.

In addition, 230 million euros have been set aside for conciliation, a figure which, however, is likely to be insufficient in the face of the more than 7,000 complaints, for an amount of about 620 million requested.

Regrets are now useless, but future scenarios do not seem so black, and the determination seems to be at the top of society. We shall see how the matter develops in the coming weeks.

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