Intesa Sanpaolo aims to reinforce its wealth management and protection attitudes, CEO says

I’m very happy. I think that we are probably today the most sustainable European bank. So if you if you look at our wealth management and protection business, we are comparable with UBS in terms of performance and our target is to reinforce our wealth management and protection attitudes. Our commissions are growing at double digit speed and will increase the speed in the next quarters. So we are leveraging on 1.3 trillion of Italian wealth and I think that being a zero MPL bank, our sustainability for the future can allow us to remain one of the strong net income generating a cash dividend payout payers in the market full credit to you when I would pepper you with questions pre COVID about how concerning the Italian economy was, how concerning the sovereign was, how parlous the broader situation, you would always turn to that that wealth story, that Italian wealth story and saying the household, the company world is huge and that is the bedrock. So full credit to you so that that that’s for sure. But if you look at the the the also the price to book or Intel San Paolo just to make so we we are we are in in in an amount that is exceeding also UBS in terms of price to book. But that that’s all related to the strength of the Italian families and the wealth of the Italian real economy. Obviously, we are able to do a business model on wealth management and protection that that’s a story on fee and commissions and that the reason why in an environment of reduction of Euribor, that will be probably the flight to quality towards Intel San Paolo in comparison with other banks that are more relying on net interest income. So that that’s what I think could happen in the future. Wealth management and protection and technology are the 2 driver or performance in the medium term for for the banking sector. That that’s my view on, on European banking sector, right. Let me bring up interest rates because we’ve just had a central bank in your cutting and looking at your numbers today, you’ve had and net interest income up 20.8% NPL ratio, very low, 1.2% net, 2.3% gross. These are somewhat backward looking numbers though. So as we look forward to what the ECB could do, is there anything in the numbers that suggests that there’s some urgency for the ECB to start cutting. So I think that ECB will start cutting the interest rates starting from June that that’s for sure. And also that there is in my view a need also to accelerate the GDP growth in Europe and through the reduction of Euribor there could be a boost in terms of growth in in in GDP growth. At the same time in the banking sector you will have a reduction in net interest income. But for the bank that they have wealth management and protection, there will be an increase in wealth management because the majority of the asset under administration, asset under custody will be transformed into capital gain positive. So if interest rate will go down, you will have capital gain and that’s the timing in which a wealth management company can propose to client to make a disposal of the capital gain positive assets and to move into other wealth management products. So that’s typically what we do and what we are starting to do this court and with the evidence of very good performance in terms of commissions.