Intesa Sanpaolo with 50 Percent Higher Net Profit in the Third Quarter

The Italian banking group Intesa Sanpaolo reported on Tuesday that it increased its net profit by nearly 50 percent in the third quarter compared to the same period last year, thanks to lower risk provisions and higher income from fees and commissions.

In the quarterly period ending in September, net profit rose by 49.48 percent to 722 million euros, according to the third quarter and first nine months business results report published on Tuesday.

Operating income in the same period increased slightly by 0.9 percent to 4.2 billion euros. Net interest income amounted to 1.91 billion euros, which was 9.3 percent lower compared to the same period a year earlier.

Net income from fees and commissions, on the other hand, increased by 8.4 percent to 1.79 billion euros. Provisions for potential losses on unpaid loans were also reduced by 40 percent to 769 million euros. In the first nine months of this year, Intesa allocated 2.38 billion euros for corresponding provisions, or nearly one-third less than in the same period the previous year, indicating improved credit trends.

In the nine-month period, 484 million euros were also allocated for provisions for risks and costs, including according to Intesa’s business report, 172 million euros allocated for the cost of converting PBZ loans from Swiss francs to euros.

In the first nine months of this year, Intesa’s operating income increased by 7.1 percent to 13.6 billion euros. Net profit in the same period reached 2.73 billion euros, which is nearly 127 percent higher compared to the same period a year earlier.

The Italian banking group confirmed that it will pay a dividend for 2015 in the total amount of two billion euros, in accordance with the outlined business plan for the period from 2014 to 2017.

Throughout 2015, the second-largest Italian bank by assets expects an improvement in operating income, supported by interest and fee income. They also expect an improvement in operating margin, as well as profit from ongoing operations before tax deductions, alongside a simultaneous reduction in risk costs.