Italy's BPER to pay out $1 bln to investors under new plan
By Andrea Mandala and Valentina Za
MILAN, June 10 (Reuters) - Italy's fourth-largest bank BPER Banca EMII.MI said it will close 30% of its branches and more than double profits to return at least 1 billion euros ($1 billion) to investors by 2025.
BPER, whose main shareholder is Italy's No.2 insurer UnipolSAI US.MI , set out its business plan on Friday to focus on fee-earning activities like insurance and wealth management to drive profits to around 800 million euros, up from 384 million last year.
"We'll boost shareholder remuneration as we grow our profits, reaching a payout ratio of 50% in 2025," BPER CEO Piero Luigi Montani said.
BPER, which insurer UnipolSAI has steered onto an expansion path as it builds a wide distribution network for its products, will set up a dedicated division to oversee the insurance business and boost non-life premiums by 80%.
Even as the European Central Bank prepares to reverse course after years of negative rates which have hammered banks' lending income, BPER said it would boost net fees to account for half its overall revenues in 2025, from 45% in 2021.
The 2022-2025 plan comes after BPER agreed to buy ailing rival Carige this year in a rescue deal financed by the industry. BPER said it expected cost savings of 155 million euros once it had completed the acquisition.
The Carige deal follows the purchase of around 600 branches BPER bought as part of Intesa Sanpaolo's UBI takeover in 2020.
BPER said it would close around 600 branches by 2024 and triple digital investments compared with the previous plan to more than half a billion euros.
It also plans to raise money from the sale of non-core assets, including its loan recovery unit, to add 500 million euros to its core capital.
Sweden's Intrum INTRUM.ST , Elliott-backed Gardant in tandem with state-owned bad loan specialist AMCO, Softbank-backed doValue DOVA.MI and DK-backed Prelios last week all submitted non-binding bids for BPER's bad loan collection business, three sources told Reuters.
The sale will lead to some 140 employees dedicated to recovering bad loans to exit the group as part of 3,000 overall staff exits to be offset in part by 1,450 new hirings.
BPER said it would offload bad debts under the deal to cut impaired loans to 3.6% of total lending in 2025 from 4.9% in the first quarter.
($1 = 0.9401 euros)
Editing by Elaine Hardcastle
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