Mediobanca, 2026 goals and dividend policy

Mediobanca expects to increase shareholder remuneration to €3.7 billion in the three-year period 2024/2026. Submit an interim return

mediobanca-logo_1leaders Mediobanca They agreed The strategic lines of the action plan for the period 2023/2026.

The Corporation intends to achieve significant growth in light-capitalized assets, with the goal of achieving best-in-class returns, associated with reduced risk and significantly increased shareholder rewards.

in detail, Mediobanca aims to grow revenues to 3.8 billion euros (+6% average compound annual growth rate for the three-year period 2023-2026) with contribution from all business sectors. Wealth Management will achieve the highest organic growth rate (+10% on average per annum) exceeding 1 billion in revenue and will become the number one contributor to complementary fees to corporate and investment banking, whose revenue growth is expected to be 11% (7% organic) reaching 0.9 billion euro. Consumer finance will continue to be the driver of growth in Mediobanca’s net interest income (around two-thirds of the total) with overall revenue growth of 5% (to around €1.3 billion). The insurance sector will confirm the Institute’s positive contribution to Piazzetta Cuccia. With revenue growth of 6% (to around €0.5 billion).

Mediobanca estimates earnings-per-share growth of about 15% on average each year; As a result, EPS should go from around €1.15 to €1.8Taking into account the cancellation of approximately 80% of the shares resulting from the buy-back plan, with the increasing contribution of wealth management, corporate and investment banking and with secondary but additional growth of the consumer finance and insurance sector, confirming the high levels of profitability.

Management also expects profitability growth at the enterprise level (ROTE to 15% from 12%, RORWA to 2.7% from 2.1%) AND DIVISION: Wealth management is expected to report the largest increase in profitability, rising from 2.9% to 4.0%; Corporate and investment banking is expected to improve to 1.6% (from 1%), consumer finance to stabilize at 2.9%, and the insurance sector to grow to 3.2% (from 2.7%).

Mediobanca expects one growth in capital generation (approximately 220 basis points annually from 150 basis points) resulting from increased profitability (ROTE from 12% to 15%) and the absence of negative material regulatory impacts in the coming years. The management indicated that the increase in resources would make it possible to finance organic and inorganic growth and compensate shareholders.

In this regard, Mediobanca expects shareholder remuneration to increase to 3.7 billion euros in the three-year period 2024/2026. (+70% compared to the previous four-year period), of which €2.7 billion is dividends and €1 billion is through buybacks and cancellations of treasury shares. The institute has determined that the increase in distribution will come from the ability to earn profits and from implementing an asset growth policy that focuses on segments with low capital absorption.

In particular, dividends will be paid on the basis of 70% payment, with lEnter interim dividends. In detail, part of the payment will be paid in advance in May (equivalent to 70% of the profits produced in the July-December term) and the remaining part to be paid in November (equivalent to 70% of the profits produced in the January-June term). Thus, the total dividend distributed in the three-year period (2024-2026) will equal 2.7 billion euros, 40% more than the 1.9 billion distributed in the previous four-year period (2020-2023).

annual programme Repurchase of treasury shares for a total value of one billion euros. The amounts will be determined annually following the organic growth achieved during the year and will see approximately 80% of the shares repurchased during the three-year period be cancelled;

Mediobanca has specified that the distribution policy, subject to ECB control and/or authorization, will be revised in the event that CET1 FL falls below 13.5%.

Mediobanca It does not rule out opportunities for external growth through acquisitions.

According to the management, the capital creation will make it possible to finance organic growth, while the bonus policy will make it possible to maintain CET1 above 14.5% over the plan period, based on a minimum CET1 FL of 13.5%. and maintaining a reserve of approximately 100 basis points of capital for use in potential external growth operations.

Considered Mediobanca Goal Which can accelerate the process of growth in distinctive business areas with a preference for companies with low capital absorption and high fee content.

during conference calls Presenting the industrial plan, Mediobanca’s CEO, Alberto Nagel, specified that the repurchase related to the fiscal year 2023 will be equal to approximately 20-25% of the total amount of the planned repurchase of treasury shares.

Thelma Binder

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