Mediobanca’s quarterly costs jump, seeks ‘buy now, spend later’ bargains

A emblem of Mediobanca is pictured at Mediobanca headquarters in Milan, Italy, November 12, 2019. REUTERS/Flavio Lo Scalzo/File Picture

MILAN, July 29 (Reuters) – Italy’s Mediobanca (MDBI.MI) beat quarterly revenue and earnings expectations, pointing to a bigger than expected improve in cost revenue as a diversified business product helped it trip out economic and market turmoil.

Main Government Alberto Nagel instructed a push briefing on Friday that the financial institution carries on to look for acquisition possibilities, favouring bolt-on bargains with “minimal execution risk”, this kind of as those people in the “invest in now, pay back afterwards” sector.

Chances could also come up in wealth administration supplied the recent demanding macroeconomic backdrop as companies which would not be sold in what he termed a “common state of affairs” may possibly now be set on the block.

Nagel has earlier thought of buying Generali’s (GASI.MI) private banking unit Banca Generali (BGN.MI) and merging with Banca Mediolanum (BMED.MI), though no deals materialised.

Mediobanca, which alongside prosperity management offers consumer finance and company and investment decision banking services, posted a net revenue of 191 million euros ($194.92 million) in the fourth quarter of its fiscal yr to June 30, previously mentioned an analyst consensus delivered by the lender of 175 million euros.

Earnings of 704 million euros also defeat expectations with a increase in payment earnings to 205 million euros topping a consensus forecast of 190 million euros.

“Opposite to expectations, price income, which is all recurring, amplified 2% Q/Q and beat consensus”, Autonomous analysts reported.

Mediobanca’s board proposed a dividend of .75 euros for every share, equivalent to a dollars payout of 70%, which Nagel said would be preserved next year as he verified all the targets of the bank’s strategic system.

The lender mentioned its “highly resilient” company design, together with shopper finance and insurance coverage segments which are less motivated by GDP traits, can mitigate the affect on profits from any even further macroeconomic deterioration.

“It is essential that there is no dislocation that lasts for lots of quarters, but Mediobanca does not depend on favourable scenarios to execute perfectly”, Nagel said.

The bank’s main funds ratio of 14.5% remained one of the best in Italy.

($1 = .9799 euros)

Reporting by Gianluca Semeraro Enhancing by Kirsten Donovan

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