Unicredit Reports Upbeat 2023 Profits, Gives Similar Forecast for 2024

<img width="250" height="166" src="https://www.leaprate.com/wp-content/uploads/2023/10/FIN-LP-UniCredit-beefs-up-Buddybank-mobile-app-for-digital-banking-5397423749-iStock-458550093-250×166.jpg" class="webfeedsFeaturedVisual wp-post-image" alt="" decoding="async" style="float: left; margin-right: 5px;" link_thumbnail="" srcset="https://www.leaprate.com/wp-content/uploads/2023/10/FIN-LP-UniCredit-beefs-up-Buddybank-mobile-app-for-digital-banking-5397423749-iStock-458550093-250×166.jpg 250w, https://www.leaprate.com/wp-content/uploads/2023/10/FIN-LP-UniCredit-beefs-up-Buddybank-mobile-app-for-digital-banking-5397423749-iStock-458550093-700×465.jpg 700w, https://www.leaprate.com/wp-content/uploads/2023/10/FIN-LP-UniCredit-beefs-up-Buddybank-mobile-app-for-digital-banking-5397423749-iStock-458550093-768×510.jpg 768w, https://www.leaprate.com/wp-content/uploads/2023/10/FIN-LP-UniCredit-beefs-up-Buddybank-mobile-app-for-digital-banking-5397423749-iStock-458550093-120×80.jpg 120w, https://www.leaprate.com/wp-content/uploads/2023/10/FIN-LP-UniCredit-beefs-up-Buddybank-mobile-app-for-digital-banking-5397423749-iStock-458550093-245×163.jpg 245w, https://www.leaprate.com/wp-content/uploads/2023/10/FIN-LP-UniCredit-beefs-up-Buddybank-mobile-app-for-digital-banking-5397423749-iStock-458550093-500×332.jpg 500w, https://www.leaprate.com/wp-content/uploads/2023/10/FIN-LP-UniCredit-beefs-up-Buddybank-mobile-app-for-digital-banking-5397423749-iStock-458550093.jpg 1257w" sizes="(max-width: 250px) 100vw, 250px" /><p>The announcement led to a 10% surge in the share price of Italy’s second-largest bank, reaching a nine-year peak. It was fueled by its strong earnings performance and a positive outlook in a year when interest rates are anticipated to begin falling.</p>
<p>While other major European banks adopted a more reserved stance in their full-year earnings reports last week, UniCredit expressed a more positive outlook. “We face the future with optimism,” stated CEO Andrea Orcel during an analyst call. Since Orcel, a former investment banking chief at UBS, took over in April 2021, UniCredit’s shares have climbed nearly 250%, reaching their highest point since May 2015.</p>
<p>Citi analyst Azzurra Guelfi noted, “The stock is one of the most favoured in the sector, yet it continues to exceed expectations.” For the fourth quarter, the bank posted a net income of 2.8 billion euros ($3.01 billion), boosted by a 900 million euro reversal of tax assets, significantly outperforming UniCredit’s consensus forecast of 1.2 billion euros.</p>
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<p>Excluding the tax asset reversals, the bank’s revenue defied expectations of a downturn by increasing 4.6% year-on-year. UniCredit saw improvements in lending income and net fees over the previous quarter, contrary to analysts’ predictions for a decrease. Additionally, provisions for loan losses in the fourth quarter were substantially lower than anticipated.</p>
<p>The bank announced a 2023 full-year net profit of 8.6 billion euros, excluding tax asset write-ups, and plans to allocate the entire sum towards share buybacks and dividends. This exceeds its previous guidance of distributing at least 6.5 billion euros based on a net profit of 7.25 billion euros or more.</p>
<p>UniCredit plans to implement a 90% payout policy, increasing the cash portion to 40% of income from 35% in 2023 and introducing an interim dividend.</p>
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