Unicredit shares jumped 7.55% to 12.422 euros for 27.37 billion capitalization after having presented the new strategic plan for the three-year period 2022-2024. Net revenues are expected to rise from over 16 billion expected in 2021 to over 17 billion by 2024, with commissions that would rise from around 38% of revenues to around 40% at the end of the plan and a cost / income ratio of 56% to 50% .
On the net profit front, the expectations of the CEO, Andrea Orcel, are to go from over 3.3 billion in 2021 to over 4.5 billion in 2024, with a return for the group that should jump from 7% to 10% (+ 42%). In addition, an organic generation of capital is expected in the order of 150 basis points (1.5%) per year with a Cet 1 ratio which would go from 13.5% -14% in 2021 to 12.5% ​​-13% in 2024 which foresees “a significantly greater and progressively growing distribution to shareholders”. In the three-year period 2022-2024 total ESG volumes are expected (these are the assets under management of the ESG type, the Debt capital market and social lending activity) for a cumulative amount of 150 billion euros.
The plan provides for a shareholder remuneration of at least 16 billion in total for the period 2021-2024 with an annual distribution “in line with the organic generation of capital for each respective year of reference”. A distribution of 3.7 billion euro is expected for 2022, consisting of a cash dividend equal to 30% of the underlying net profit and share buybacks for the remainder.
The total distribution for 2022 is expected to be in line or higher than that of the current year, with a progressive increase starting from 2023. The annual cash dividend for 2022 will be 35% of the net profit and for the following years at least 35% of profits with the remainder in share repurchases.
On the conference call, CEO Orcel explained that, on the M&A front, after closing in October with the acquisition of an MPS perimeter from the Treasury, he does not rule out “mergers and acquisitions, but I don’t even plan them”. The criteria for extraordinary operations, Orcel added, “are strategic, they help us to improve the Rote and the remuneration objectives, they must strengthen the business”.
According to the industrial plan, the objectives will be achieved by growing in geographical areas and developing the customer network, “transforming the business model and the way we operate” with “quality growth, both with respect to current customers and new customers. “, developing” best-in-class products and services, internally or with external partners “, growing” low capital absorption, with a focus on products and services with added value for customers “(therefore more assets under management and insurance sector and fewer loans) and through “selective cost efficiency to finance investments and ensure operational leverage”.
Through investments in digital, Unicredit intends to bring “the 13 banks to act as a fully integrated group”, manage the system centrally, “empower local banks within clear risk and behavior models”, report to the core competencies. The group intends to achieve a cost reduction of 0.5 billion in absolute value by 2024, net of 0.6 billion in investments (Digital & Data and business) and 0.5 billion in inflation. The group has planned investments of 2.8 billion in the Digital & Data sector over the plan.
By 2024, 3,600 net new hires are expected in Business and Digital & Data. Specifically, the group intends to increase the workforce by 1,500 people in all geographical macro-areas, of which 900 in Italy, 300 in Central and Eastern Europe, 200 in Germany and 100 in control functions. (All rights reserved)

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