Annual Report • Mar 30, 2017
Annual Report
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Banca Sistema Group
as at 31 December 2016
Corso Monforte, 20
20122 - Milano
Tel. +39 02 802801
Fax +39 02 72093979
Certified e-mail: [email protected]
Via Toledo, 156
80134 - Napoli
Tel. + 39 081 0609214
Fax + 39 081 0609215
Date of incorporation: 16 September 2005
Registration in the Companies' Register: 26 September 2005
Tax Code, VAT Number and registration number in the Companies' Register of Milan: 04986270967
Economic and Administrative Index (R.E.A.) number 1787383
A company belonging to the Banca Sistema Group, until 31 December 2016, and subject to management and coordination by Banca Sistema S.p.A., listed in the Companies Register of Milan under R.E.A. number 1787383, and listed at number 95 in the register of financial intermediaries pursuant to Article 107 of the Consolidated Law on Bank (TUB), previously Legislative Decree 141/2010 which temporarily continued the activities pursuant to Article 10 of Legislative Decree 141/2010 (already entered in the general list at no. 37314 set out in Article 106 of Legislative Decree no. 385 of 14 September 1993, and at no. 33112.4 of the "special list" set out in Article 107 of Legislative Decree no. 385 of 14 September 1993),
removed from the register, effective 1 January 2017, following the merger by incorporation into Banca Sistema S.p.A.
Share Capital: Euro 47,000,000.00 fully subscribed and paid in
A member of ASSIFACT - Association of Italian factoring companies
| Directors Report on Management Performance 6 | |
|---|---|
| Domestic and international macro-economic overview 8 | |
| Public Finances 10 | |
| The banking sector 12 | |
| The Italian factoring market 14 | |
| Summary of Company performance and management results 16 | |
| Main operating information 19 | |
| Exposure and management of financial risks 22 | |
| Commentary on the financial results 23 | |
| Other disclosures 28 | |
| Relations with related parties 29 | |
| Treasury shares and shares of the parent company 30 | |
| Fair Value of financial instruments 31 | |
| Internal Control System 32 | |
| Significant events occurring after the close of the financial year 33 | |
| Business outlook 34 | |
| Information regarding business continuity 34 | |
| Proposal of the Board of Directors 35 | |
| Financial statements as at and for the year ended 31 December 2016 36 | |
| Statement of financial position 36 | |
| Income statement 37 | |
| Statement of comprehensive income 38 | |
| Statement of changes in equity 39 | |
| Statement of Cash Flows (indirect method) 40 | |
| Notes to the financial statements 42 | |
| Part A - ACCOUNTING POLICIES 43 | |
| A.1 – GENERAL PART 44 | |
| A.2 - MAIN FINANCIAL STATEMENTS CAPTIONS 49 | |
| A.4 – FAIR VALUE DISCLOSURE 57 | |
| A.5 Information on "Day one profit/loss" 59 | |
| Part B - NOTES TO THE STATEMENT OF FINANCIAL POSITION 60 | |
| ASSETS 60 | |
| LIABILITIES 68 |
| Part C - NOTES TO THE INCOME STATEMENT 73 | |
|---|---|
| Part D – OTHER DISCLOSURES 82 | |
| Section 1 – Specific disclosures about the business 82 | |
| Section 2 - Securitisation transactions and sale of assets 87 | |
| Section 3 - Risks and related hedging policies 88 | |
| Section 4 – Equity 105 | |
| Section 5 – Statement of comprehensive income 110 | |
| Section 6 – Related party transactions 111 |
| Management and Control Bodies | Board of Statutory Auditors in office until 30/06/2016 |
|---|---|
| Board of Directors in office until 30/06/2016 | Chairman |
| Chairman | Fedele Gubitosi |
| Andrea Rigoni * | Standing Auditors |
| Chief Executive Officer | Francesco Genoni |
| Fausto Galmarini ** | Riccardo Bordoli |
| Francesca Discepolo | Alternate Auditors |
| Gaetano Caprino | Alessandro Ceriani |
| Antonio Salvi | Marco Armarolli |
| Board of Statutory Auditors2 | |
| Board of Directors1 | Chairman |
| Chairman | Diego De Francesco |
| Margherita Mapelli* | Standing Auditors |
| Chief Executive Officer | Fedele Gubitosi |
| Fausto Alberto Edoardo Galmarini** | Massimo Conigliaro |
| Alternate Auditors | |
| Directors | Alessandro Ceriani |
| Massimiliano Ciferri Ceretti | Marco Armarolli |
| Egisto Franceschi | |
| Stephen Skerrett | Independent Auditors |
| PricewaterhouseCoopers S.p.A. | |
| * Chairman of the Executive Committee | |
| ** Member of the Executive Committee | Supervisory Board3 |
| Mr Daniele Discepolo | |
| Mr Manlio Genero | |
| Ms Maria Salvi |
1 In office since 01/07/2016.
2 In office since 01/07/2016.
4Appointed by the Board of Directors on 15 December 2010
Dear Shareholders,
we highlight the following major events that occurred during the year just ended:
On 16 September 2016, the Company and Banca Sistema signed the aforementioned commercial collaboration agreement, setting the relative economic conditions;
By letter on 28 September 2016, having acknowledged the authorisation request for the merger by incorporation presented by Banca Sistema, the Supervisory Authorities informed the Company of the suspension of the registration procedure terms under amended article 106 of the Consolidated Law on Banking pending the final outcome of the merger project;
Global economic conditions have improved slightly (Source: Bank of Italy economic bulletin January 2017). A number of uncertainties continue to weigh on the outlook. Prospects for the United States will depend on the economic policies enacted by the new administration which have yet to be worked out in detail. The announced fiscal policy measures could have an expansionary effect although it is difficult to quantify at the moment, but negative effects may result from the adoption and spread of restrictive trade measures. Global growth could be slowed by turbulence in emerging market economies associated with the normalisation of US monetary policy.
Expectations in the financial markets of an expansionary budgetary policy and higher inflation in the United States, which emerged after the presidential elections, have triggered a shift in portfolios from bonds to equities. Long term yields have also risen in other advanced economies, but only to a limited extent due to a divergence of monetary policies.
Capital outflows from emerging economies have resumed. Growth in the Euro area continues at a moderate though gradually strengthening pace.
The risks of deflation have decreased; inflation increased in December but core inflation is still at low levels. In order to maintain adequate expansive monetary conditions and ensure inflation continues to move upward, the ECB's Governing Council has decided to extend its bond purchasing programme at least until December 2017, or beyond, of necessary.
According to the latest available indicators, in autumn the Italian economy continued to recover, even if only moderately.
Considering the trends in industrial production, electrical consumption and freight transport, which all recorded growth, and the business confidence indicators which are at high levels, GDP is estimated to have increased at a rate of around 0.2% in the fourth quarter of 2016 compared to the previous period.
Economic activity was stimulated by a pick-up in investments and increased household spending. Signs of stabilisation in the construction sector, and especially in the residential sector, have been confirmed. The downward trend in the consumer confidence index, which started in the beginning of the year, stalled in December.
The Bank of Italy's TARGET2 debtor position remained essentially unchanged in the last quarter of 2016, reaching 357 billion Euro at the end of December. Considering the balance of payments figures (for which data is available up to November), the continuous widening of the balance between January and November can be attributed above all to the diversification of Italian households portfolios towards asset management services and insurance products - which are characterised by investment policies that are less biased towards domestic assets - and from the drop in bank funding on the international markets, which coincided with the creation of liquidity through the Eurosystem programmes. The surplus in the current account has recorded a further improvement.
In the third quarter of 2016, total employment stabilised and the number of employed workers, both fixed term and permanent, increased. The latest economic indicators point to a moderate expansion in employment in the final months of 2016.
During the year, the trend in private-sector salaries decreased considerably, impacted by both the delays in many renewals, and from the lack of salary increases given in 2016: the significant freeze in contractual salaries has impacted nearly half of payrolled workers.
The forecast for the Italian economy, updated based on the most recent developments and corrected for the number of working days, indicate an average increase in GDP of 0.9% in 2016. For this year, it is expected to grow at about the same pace of 0.9%, before increasing to 1.1% in both 2018 and 2019.
Economic output will still be driven by domestic demand already in this year, and also by the gradual strengthening in foreign demand.
The level of GDP in 2019 will still be about 4 percentage points lower than 2007.
The economic framework assumes a continued moderate level of long-term yields and relaxed credit standards in terms of cost and availability.
Overall, it is estimated that the risks to growth remain primarily oriented towards the downside. The main factors feeding the uncertainty, apart from the financial conditions, stem from the global situation.
In contrast to the main assumptions underpinning the projections, the risk is particularly high that the global economic recovery may be affected by the emergence and spread of protectionist policies along with possible turbulence in emerging economies.
Estimates based on information, that are still preliminary, provided by the Bank of Italy (cfr. Economic Bulletin of the Bank of Italy - January 2017), suggest that, in 2016, public administration net borrowing would decrease compared to 2015 and that the reduction could even be slightly greater than the decrease communicated by the government in September's Update of the 2016 Economic and Financial Document. Moreover, the ratio of debt to GDP is estimated to have grown slightly. Official assessments indicate that the budgetary provisions for the three-year period 2017-19 grew the deficit by about half a percentage point on average of GDP compared to the current scenario.
In 2016, state sector borrowing reached 47.7 billion Euro, a decrease of about 11 billion Euro compared to 2015. In the first eleven months of the year, the general government borrowing requirement net of real estate sales, came to 53.3 billion Euro, around 10.5 billion Euro less than the corresponding period of 2015.
Based on estimates released by Istat, in the first nine months of last year, net borrowing by the public administration was 2.3% of GDP compared to 2.6% reported in the corresponding period of 2015. The increase in primary current expenditures (1.2%), driven by the growth in intermediate consumption expenditures (2.4%) and cash social benefits (1.8%), were more than offset by the positive trend in inflows (0.9%), lower interest payments (-2.6%) and by a reduction in capital account expenditures (-8.1%). Regarding this last item, fixed gross investments posted a modest decline of 0.5% while the reduction in other capital account expenditures was more significant at - 19.1%.
At the end of November government borrowing amounted to 2,229.4 billion Euro, an increase of 56.7 billion compared to the end of 2015. Given the reduction in the Treasury's cash balance of around 3 billion Euro and the government's probable cash surplus in December, in 2016 the ratio of debt to GDP is expected to have increased by less than half a percentage point.
In December, Parliament approved the budgetary provisions for the three-year period 2017-19. These include expansionary measures valued at about 26 billion against funding generation of just over 13 billion. The budgetary provision with the most impact on the public finances is the cancellation, for this year only, of the VAT rate increase which, according to current legislation, would have generated more than 15 billion in additional revenue. An additional 11 billion or so were allocated almost entirely to increased expenditure aimed at boosting investments and providing income support to certain segments of the population. Finally, funds have been allocated for multi-year expenditures related to managing seismic emergencies. Half of the financial coverage comes from expected revenues from anti-tax evasion measures and tax collection measures such as the extension of the voluntary disclosure deadlines and settlements and concessions in tax collection cases.
According to official assessments the provisions will bring net borrowing to 2.3% of GDP this year, 0.7% higher than that current trend.
According to the government's estimates for the two-year period 2018-19, the deficit will decrease more rapidly than in 2017, in large part due to the increase in indirect taxes under the safeguard clauses, from greater permanent income from anti-tax evasion measures and from the delay, as provided for in the budgetary provisions, of certain capital expenditures in the period from 2019 to 2020.
Based on information provided by the Bank of Italy (cfr. Economic Bulletin of the Bank of Italy - January 2017), in the three months ended in November, lending to the private non-financial sector grew slightly (1.1% adjusted for seasonality and annualised). Household lending accelerated to 2.1% with continued robust growth both in consumer credit (2.7%), driven by the trend in disposable income, and from home mortgages (2.0%), which is in line with the increase home sales.
In November, the increase in lending to businesses was marginally positive over the three months (0.3%, adjusted for seasonality and annualised) and was unchanged over the twelve months. Differences persist based on the economic sector: lending to companies in the services sector continued to increase (2.3% over twelve months), whereas loans to manufacturing companies dropped slightly (-0-5%). The contraction in lending to construction firms continues to worsen (-5.4%). Lending to firms with 20 or more employees has essentially flat at 0.4%, while the decline in lending to smaller sized firms slowed slightly to -3.2%.
Between August and November total funding of Italian banks remained substantially stable. The increase in resident deposits and the greater use of refinancing transactions with the Eurosystem have somewhat offset the drop in bonds held by households. The placement of bonds with intermediaries and institutional investors has continued to decline.
The demand for business loans has remained substantially unchanged. Demand from households for home mortgages and consumer credit have continued to strengthen and are driven by low interest rates and the improved outlook in the real estate market.
Banks have made use of the Targeted Longer-Term Refinancing Operations (TLTRO2) mainly to take advantage of the very favourable interest rates. The liquidity obtained overall was used, and will continue to be used to replace the refinancing operations with Eurosystem, to grant loans to firms and households and, to a lesser extent, to replace other maturing debt. The operations have had a positive impact both on the lending policies and on the terms and condition offered on loans to customers.
The cost of credit is currently at historically low levels. In November, the average interest rate on new business loans continued to decrease by 10 basis points to 1.6% compared to August. The cost of new mortgages dropped by 15 basis points to 2.2% for fixed rate loans, and by 10 basis points to 1.7% for variable rate loans. The spread with the euro-area average remained practically nil for loans to firms and was very narrow for those to households (25 basis points).
The improvement in the economic outlook continues have a beneficial effect, albeit gradual, on the credit quality of Italian banks. In the third quarter of 2016, the ratio of new non-performing loans and receivables to total outstanding loans fell three-tenths of a percent from 2.9% to 2.6% on a seasonally adjusted annualized basis. The ratio fell by four-tenths of percent 4.1% for loans to firms and by two tenths of a percent to 1.7% for those to households.
According to ABI, the stock of net non-performing loans at the end of 2016 totalled 86.9 billion Euro representing 4.89% of total loans.
The profitability of the significant banking groups diminished in the first nine months of 2016 compared with the same period last year: annualized ROE dropped to 1.4% from 3.8%. Net interest income and other income decreased by 4.3% and 1.4 %, respectively.
Operating costs increased by 6.1%, mainly due to the extraordinary expenses associated with voluntary redundancy schemes for some personnel and with contributions to the deposit guarantee and resolution funds.
Gross income diminished by about one fifth. Write-downs of loans and receivables rose by 20.6 per cent, following the significant increase in the NPL coverage ratios by some banks.
Capital adequacy improved slightly in the third quarter. The CET1 ratio for the significant banking groups averaged 11.9% of risk-weighted assets, about 10 basis points higher than in June.
At the end of December, the Government authorized the financing of possible measures, in the form of guarantees for newly issued liabilities or capital injections, to support Italian banks or banking groups, up to a maximum of 20 billion Euro for 2017; it will proceed with the precautionary recapitalization requested by Banca Monte dei Paschi di Siena, in compliance with European regulations on bank recovery and resolution and State aid.
The Italian factoring market represents a significant share of both the worldwide and European factoring markets (about 8% and 11%, respectively according to the latest information provided by EUF) and is equal to about 12% of GDP.
According to Assifact, turnover realised by operators in the sector totalled 202,402 million Euro in 2016, an increase of 9.53% with respect to the prior year.
Unlike the trend in bank loans, which were severely impacted by the economic crisis that characterised the last 9 years, factoring saw continuous growth in business over the same period (from the pre-crisis period in 2007 to 2016, turnover increased by 60%), demonstrating a certain resilience to negative economic events, as well as being clearly anti-cyclical.
Outstanding receivables at 31 December 2016 totalled 61 billion Euro, an increase of 6.12% with respect to 2015. Without recourse (including permanently acquired position) represents 69.5% of the total versus 30.5% for with recourse.
The total of loans (advances to sellers and consideration for permanently acquired loan positions) was 49.7 billion Euro, an increase of 8.43% with respect to the previous year.
The capacity of the sector to support businesses during the downward phase of the cycle is related to the operators' unique approach to managing risks in which evaluation is not limited to the party being financed, but the quality of the factored receivables and the solvency of the debtors are also considered (payments are monitored on a daily basis). The attention paid to managing the factored receivables allows for risk to be significantly better contained with respect to normal bank loans.
From preliminary estimates provided by Assifact on a sample of 16 members, gross doubtful loans in the factoring segment at 31 December 2016 were 3.20% of total exposure (less than one third of the figure reported by Banks), the unlikely to pay category was 1.45%, and the non-performing past due exposures were 2.02%.
With regard to the geographical breakdown of the sellers (sample of 21 members representing 91% of turnover), the most developed areas is Lombardy (30%), followed by Lazio (24%), Piedmont (11.7%), Veneto and Emilia Romagna (both at 6.5%), followed by Campania (4%) and Tuscany (3.5%).
With regard to assigned debtors, most are located in Lazio (27%), in Lombardy (21%), Emilia Romagna (7.6%), Piedmont (7.5%), Veneto (6.5%), Campania (6.4%), Tuscany (4.9%), and Sicily (3.5%).
More than 23% of outstanding receivables are Public Administration debtors, while the sector's exposure is 17%.
The non-performing exposures account for 6.67% of total gross exposures (down from 8.6% in 2015). Doubtful receivables make up 48%, non-performing past due exposures 30% and unlikely to pay 22%. With recourse transactions account for the majority of loans in both the non-performing and doubtful categories.
With reference to the Public Administration, at 31 December 2016, 35% of outstanding credit was past due (of which 58% was more than one year past due). Past due certified receivables account for 3.10% of the total.
With reference to the economic sector, 48% of the past due are from National Health Service entities, 27% from Central Administration offices, and 23% from the local authorities.
With regard to the breakdown by territory, 39% of past due receivables refer to entities located in Lazio, 16% to entities located in Campania, 8% in Sicily, 7% in Calabria, 6% in Puglia, and 5% in Tuscany.
Notwithstanding the efforts made over the years by the last three governments with disbursement of 56 billion Euro overall (the most robust since the enactment of Legislative Decree no. 35 of 08 April 2013, converted by Law no. 64 of 06 June 2013) to reduce the stock of certain, liquid and collectable pre-existing Public Administration debt, and the transposition of the EU regulation on late payments that exacerbated the amount of default interest for payments beyond 30 days (60 days for some entities of the national health service located in Regions subject financial recovery plans), public entities continue to have difficulties in fulfilling payment commitments at agreed due dates.
An estimate by the Bank of Italy in June 2016 puts the total debt owed by the Public Administration at 65 billion Euro, 31 billion of which are "physiological" and 34 billion are past due. The previously mentioned statistics as of 31 December 2016 regarding past due debt provided by Assifact are emblematic in this regard and evidence that this phenomenon persists.
For suppliers, the assignment of loans and receivables from public entities, especially without recourse, has represented, and will continue to represent an important tool for rebalancing their finances and for entrusting judicial credit recovery to third parties. In this context, the sector has performed, and will continue to perform, an important role in supporting SMEs even in relation to the difficulties in lending that have come forth in banking system because of increased risk and the subsequent capital reinforcement requirements from the Supervisory Authorities.
However, the Company was unable to take advantage of the favourable conditions of this specific market, despite have plenty of liquidity, because it was instructed by its former parent company to curb operations because of the advanced negotiations with a banking group, negotiations that were concluded on 4 February 2016 with the signing of an agreement in which Stepstone FH, the former Single Shareholder, would transfer 100% of its shares to Banca Sistema, subject to authorisation from the Supervisory Authority.
Having received the necessary authorisations, on 1 July 2016 the former Single Shareholder and Banca Sistema signed the closing agreement and on the same date the Company became part of the Banca Sistema Group.
In the second half of the year, in connection with the proposed merger of the Company into Banca Sistema, commercial operations were in large part channelled towards the parent through an ad hoc collaboration agreement (the Company continued operating only with revolving customers).
Consequently, turnover was impacted by the above mentioned constraints reaching 37.4 million Euro, a decrease of 14% with respect to 2015.
Considering (i) the plentiful amount of liquidity available and (ii) the agreements between the buyer and the seller, even from a cost management point of view, on 28 June 2016, the Company repaid the subordinated loan to the former Single Shareholder granted for regulatory purposes, in advance and without penalty, including accrued interest from the date on which the loans was granted, upon receiving clearance from the Bank of Italy.
As mentioned in the previous report to the financial statements, in January 2016, the Company, with the support of its tax consultants, filed a detailed defence with the Inspections Division of the Revenue Office regarding the observations in the tax audit report (PVC) issued on 04 December 2015 by the Revenue Office regarding the 2012 tax year challenging the transfer pricing on intercompany loans.
In the first half of 2016, the Company provided the Revenue Office with additional requested documentation (always regarding transfer pricing on intercompany loans but this time with reference to the 2011 and 2013 fiscal years, as well as information and data related to, and provided by the former Single Shareholder. As of today, no measures were issued regarding the 2012 tax year.
However, on 14 December 2016, the Revenue Office notified the Company of two assessment notices regarding the 2011 tax year (one for transfer pricing for 1,093 m, and the other for withholding tax for 1,404 m). A specific provision for these assessments was not made since the Company feels that it has fully complied with the regulations and intends to present its case in the appropriate forum. In that regard, Banca Sistema (who took over Beta Stepstone as a result of the merger with effect as from 1st January 2017), obtained eligible guarantees and contractual indemnities from the former sole shareholder of Beta Stepstone (Stepstone Financial Holdings).
Revenues derived from interest on loans and receivables without recourse (from the assignor), from legally established late payment interest (from the debtor), from capital gains (difference between the nominal value of collected receivables and the amortised cost), and interest on bank deposits, decreased by 3.3% with respect to the prior period attributable to the decrease in portfolio loans and receivables resulting from collections volumes being higher than new acquisitions, and to the decrease in bank deposits from the early repayment to the former Single Shareholder of the subordinated loan granted for regulatory purposes.
Despite the drop in turnover for the reasons mentioned above, commission revenues recorded an increase of 2.8% attributable to a non-recurring income item (231 penalty) collected from an assignor on some legally actioned loans and receivables for which the legal rate of interest was recognised by the courts, and not the late payment interest according to Legal Decree 231.
Repayment of the subordinated loan mentioned previously allowed for a significant reduction in the funding costs (-68%) which more than offset the slight drop in revenues.
This resulted in a significant improvement in the net interest and other banking income which grew by 19.6% with respect to the previous year.
With regard to operating costs, there was an additional decrease in personnel costs (-15.8%) following the redundancy of 4 resources (one of which was a senior manager), and the transfer of 3 resources (including one senior manager) to the parent company Banca Sistema in fourth quarter, despite the "extraordinary" incentive paid to a redundant executive.
Administrative expenses also decreased, down -23% compared with the previous year, mainly from lower consultancy and legal expenses.
The total write-backs resulting from the collection of more late payment interest and impaired loans and receivables than expected is significantly below the figure from the previous year because of the lower volume of collections and for the lack of "extraordinary" compensation recorded in 2015 tied to late payments by certain debtors. The existence of such a significant write-back amount, even in the current year, demonstrates the continuous prudence adopted by the Company in estimating provisions. With regard to default interest, which was accounted for only after the judicial assessment, it should be noted that the company policy requires a 20% lump-sum adjustment that is supported by a historical series collection data from completed judgements which show that recovery is more that 90%.
In 2016, taxes again benefited from the abatement resulting from ACE (aid to economic growth) which is granted though regulation to companies that strengthen their financial position or reinvest their earnings. The overall rate was 21% versus 31% in 2015.
Profit after tax was down 14.8% on 2015.
Net profit on the other hand was substantially in line with the previous year despite a slow down in operations.
The following tables provide a comparison of turnover, outstanding receivables, and collections at 31 December 2016 and 31 December 2015.
| Millions of Euro | 2016 | 2015 | Change |
|---|---|---|---|
| Without recourse | |||
| CALABRIA | 8.0 | 4.7 | 71% |
| CAMPANIA | 3.4 | 6.6 | -49% |
| Total Without Recourse | 11.4 | 11.2 | 1% |
| With recourse | |||
| CALABRIA | 17.3 | 17.9 | -3% |
| CAMPANIA | 3.7 | 5.5 | -33% |
| LAZIO | 2.7 | 6.1 | -55% |
| MARCHE | 1.0 | 1.3 | -22% |
| MOLISE | 0.1 | 0.4 | -74% |
| SARDINIA | 1.3 | 1.5 | -16% |
| Total With Recourse | 26.1 | 32.7 | -20% |
| Total turnover | 37.4 | 43.9 | -15% |
The number of invoices acquired in 2016 were 1,282 (of which 838 with recourse) compared to 1.265 (of which 931 with recourse) in 2015.
Outstanding receivables at their nominal value at 31.12.2016 are geographically distributed as follows:
| €/million | 2016 | 2015 | % Change |
|---|---|---|---|
| CALABRIA | 30.3 | 38.8 | -22% |
| CAMPANIA | 20.4 | 20.9 | -3% |
| LAZIO | 7.1 | 11.2 | -37% |
| VENETO | 4.1 | 0.0 | 100% |
| OTHER | 0.8 | 0.2 | 411% |
| TOTAL | 62.7 | 71.1 | -12% |
| €/million | Without recourse | With recourse |
|---|---|---|
| CALABRIA | 25.4 | 5.0 |
| CAMPANIA | 16.2 | 4.9 |
| LAZIO | 4.5 | 2.5 |
| MOLISE | 0.01 | 0.0 |
| PUGLIA | 0.03 | 0.0 |
| VENETO | 0.0 | 4.1 |
| TOTAL | 46.2 | 16.5 |
Outstanding by region 2016 Outstanding by region 2015
| Collection detail | Fiscal year 2016 | Fiscal year 2015 |
|---|---|---|
| Capital balance of without recourse receivables | 15,263,941 | 24,308,432 |
| Capital balance of with recourse receivables | 30,128,568 | 20,586,298 |
| Interest on receivables without recourse | 4,292,091 | 10,749,957 |
| Total | 49,684,601 | 55,644,687 |
| Employees at 31 December 2015 |
Joiners | Promotions | Terminations/Leavers | Employees at 31 December 2016 |
|
|---|---|---|---|---|---|
| Managers | 2 | - | - | (2) | 0 |
| Middle managers |
7 | - | - | (2) | 5 |
| Office workers | 10 | - | - | (3) | 7 |
| TOTAL | 19 | - | - | (7) | 12 |
As at 31 December 2016, excluding the Chief Executive Officer, the Company had 12 employees.
of which:
| Naples office | Milan office | Employees at 31 December 2016 |
|
|---|---|---|---|
| Managers | 0 | 0 | 0 |
| Middle managers |
4 | 1 | 5 |
| Office workers | 7 | 0 | 7 |
| TOTAL | 11 | 1 | 12 |
Note that 3 of the 7 leavers (one manager, one middle manager, and one office worker) were hired by the parent Banca Sistema in the second half of 2016 in view of the merger of the Company.
Information related to the Company's exposure to financial risks and the management policies are illustrated in the notes to the financial statements in part D - Other disclosures.
In €
| 2016 | 2015 | ||
|---|---|---|---|
| 10 | Interest and similar income | 4.962.193 | 5.132.023 |
| 20 | Interest and similar expense | (516.102) | (1.593.796) |
| Net interest income | 4.446.091 | 3.538.227 | |
| 30 | Fee and commission income | 1.311.514 | 1.275.020 |
| 40 | Fee and commission expense | - | - |
| Net fee and commission income | 1.311.514 | 1.275.020 | |
| Total income | 5.757.606 | 4.813.247 | |
| 100 | Net impairment losses/reversals of impairment losses on: | 1.340.618 | 3.113.045 |
| a) financial assets | 1.340.618 | 3.113.045 | |
| b) other financial transactions | - | 0 | |
| 110 | Administrative expenses: | (3.046.656) | (3.683.412) |
| a) personnel expenses | (1.659.837) | (1.971.853) | |
| b) other administrative expenses | (1.386.819) | (1.711.559) | |
| 120 | Depreciation and net impairment losses on property and equipment | (12.912) | (32.430) |
| 130 | Amortisation and net impairment losses on intangible assets | (17.222) | (54.431) |
| 150 | Net accruals to provisions for risks and charges | (500.000) | 0 |
| 160 | Net other operating expense | (55.110) | (84.379) |
| PRE-TAX PROFIT FROM CONTINUING OPERATIONS | 3.466.324 | 4.071.640 | |
| 190 | Income taxes on continuing operations | (731.442) | (1.270.045) |
| PROFIT FOR THE YEAR | 2.734.882 | 2.801.596 |
The 2016 financial year closes with net income of Euro 2,734 thousand after recording income taxes of Euro 731 thousand.
The positive change in interest margins is tied to the significant reduction in funding interest resulting from the Company's full repayment during the period, to the (former) single shareholder, of the subordinated loan using its own available funds.
With respect to interest income: late payment interest from debtors (without-recourse operations) remained stable, interest earned from customers on with-recourse advances increased, while interest on bank deposits decreased because of the reduction in the bank balance following the repayment of the subordinated loan mentioned previously.
Net commissions are in line with previous year.
Fixed costs decreased significantly both as a result of lower personnel costs (7 fewer employees compared to 2015) despite the payment of a leaving incentive to a manager (€100k) and as a result of lower administrative expenses (consultancy and legal expenses).
The composition of interest and similar income is detailed below.
| 31-dic-16 | 31-dic-15 | Change | |
|---|---|---|---|
| Default interest | 3.426.930 | 3.469.955 | -1% |
| Interest income - customers | 1.778.625 | 1.308.713 | 36% |
| Other interest income - debtors' compensation, etc | - | 343.035 | -100% |
| Interest income - banks | 234.727 | 488.900 | -52% |
| Total interest income | 5.440.281 | 5.610.602 | -3% |
| Write-down of default interest | (959.668) | (648.403) | 48% |
| Interest income, net of write-down | 4.480.613 | 4.962.200 | -10% |
| Realised gains | 1.903.462 | 1.330.859 | 43% |
| Gain / Loss from application of IAS | (1.421.881) | (1.161.036) | 22% |
| Total Gains / Losses | 481.581 | 169.824 | 184% |
| Interest and similar income | 4.962.193 | 5.132.023 | -3% |
Interest expense decreased by 68% compared to the previous year as a result of the repayment of the subordinated loan to the former single shareholder.
| 31-dic-16 | 31-dic-15 | Change | |
|---|---|---|---|
| Interest and financial charges | 577 | 33.090 | -98% |
| Interest expense and bank charges | 15.799 | 50.620 | -69% |
| Interest expense - Shareholder Loan | 310.086 | -100% | |
| Interest expense - Subordinated Shareholder Loan | 499.726 | 1.200.000 | -58% |
| Total interest and similar expense | 516.102 | 1.593.796 | -68% |
Economic effect amortised cost receivables without
The increase in total income and the simultaneous reduction in fixed costs led to an improvement in profitability from ordinary operations.
The decrease in pre-tax profit is attributable to lower write-backs on default interest receivables (2015 was positively impacted by extraordinary compensation received from some debtors from the Campania region, who were tied to late payments on a portion of the receivables included in the memorandum of understanding that had been entered into with the Campania Region).
Profit after-tax is essentially in line with that of the previous year thanks to lower taxes from applying the ACE tax incentives.
| In € | |||
|---|---|---|---|
| Assets | 31/12/2016 | 31/12/2015 | |
| 10 | Cash and cash equivalents | 1,762 | 1,937 |
| 40 | Available-for-sale financial assets | ||
| 60 | Loans and receivables | 83,454,122 | 105,580,711 |
| with banks | 14,360,698 | 28,765,262 | |
| with customers | 69,093,424 | 76,815,448 | |
| 100 | Property and equipment | 30,533 | 96,352 |
| 110 | Intangible assets | 13,656 | 23,728 |
| 120 | Tax assets | 4,800,230 | 2,457,456 |
| a) current | 2,420,856 | 46,795 | |
| b) deferred | 2,379,375 | 2,410,661 | |
| including as per Law no. 214/2011 | 1,272,761 | 1,339,749 | |
| 140 | Other assets | 1,227,385 | 1,598,622 |
| Total assets | 89,527,688 | 109,758,805 |
| Liabilities and equity | 31/12/2016 | 31/12/2015 | |
|---|---|---|---|
| 10 | Financial liabilities | 19,575,096 | 39,373,515 |
| 70 | Tax liabilities: | 5,913,856 | 5,230,561 |
| a) current | 1,074,849.86 | 16,861 | |
| b) deferred | 4,839,006 | 5,213,700 | |
| 90 | Other liabilities | 1,470,392 | 3,056,938 |
| 100 | Post-employment benefits | 357,830 | 414,072 |
| 110 | Provisions for risks and charges: | 500,000 | 0 |
| a) pension and similar obligations | 0 | 0 | |
| b) other provisions | 500,000 | 0 | |
| 120 | Share capital | 47,000,000 | 47,000,000 |
| 160 | Reserves | 12,068,697 | 11,928,617 |
| 170 | Valuation reserves | (93,064) | (46,493) |
| 180 | Profit (loss) for the period | 2,734,882 | 2,801,596 |
| Total liabilities and equity | 89,527,688 | 109,758,805 |
The decrease in assets is mainly attributed to the reduction in portfolio loans and receivables, and the funds available in the bank accounts.
With regard to the loans and receivables, collections during the period were higher than disbursements for new acquisitions while cash in banks was in large part used to repay the subordinated loan and to pay the 2015 dividend to the former single shareholder.
The increase in deferred tax assets is tied to the current tax receivables (advance payments of IRES/IRAP).
Figures in '000
| Liabilities detail | 31/12/2016 | 31/12/2015 | Absolute change |
|---|---|---|---|
| Due to financial institutions Amounts due to assignors for II |
52 | 52 | |
| tranches Subordinated loan from the |
19,575,096 | 23,198,305 | 3,623,210 |
| Shareholder | 0 | 16,175,158 | 16,175,158 |
| Total liabilities | 19,575,096 | 39,373,515 | 19,798,420 |
The decrease in liabilities is attributed to (i) the decrease in the amounts due to assignors in relation to payment of the second tranches, and (ii) repayment of the subordinated loan mentioned above.
The other liabilities consist mainly of (i) legal fees payable to be settled for Euro 0.5 million, (ii) Due to entities for collections to be recharged and RTU for Euro 0.5 million, (iii) trade payables for Euro 0.2 million, (iv) due to social security institutions for Euro 0.1 million.
As a result of the profit achieved, total equity is in line with the previous year despite the 2015 dividend payment to the former Single Shareholder.
No research and development activity was carried out during the year.
With regard to the merger of the company into Banca Sistema, with legal and tax effect from 1 January 2017, the company fulfilled, for the last time and on an individual basis, the following regulatory requirements:
The ICAAP Report, which the company has regularly filed with the Bank of Italy for the years 2012, 2013, 2014 and 2015, will not, however, be prepared on an individual level for 2016 because it will be prepared by the incorporating company, Banca Sistema.
Relations with related parties relate exclusively to the current account with the parent Bank which had a cash balance of Euro 14,294,789 at 31 December 2016 and is subject to condition normally found on the open market, as well as the commercial collaboration agreement signed on 16 September 2016 which has resulted in the Company receiving commissions from Banca Sistema totalling Euro 46,695.
It should also be noted that in the first half of 2016, having received clearance from the Bank of Italy, the Company repaid the former Single Shareholder Stepstone FH - a related party until 1 July 2016 the subordinated loan granted for regulatory purposes of Euro 10,000,000, along with the interest accrued from the date on which the loan was granted (of which Euro 499,726 attributable to the year).
The Company does not hold, nor has it held during the year, directly or indirectly through other parties, treasury share or shares of the parent companies.
At 31 December 2016, there were no financial assets or financial liabilities valued at fair value on a recurring basis.
Regarding the determination of fair value of the financial instruments to be provided in the mandatory disclosure in the Notes to the Financial Statements, the following methods were applied:
Also, at 31 December 2016 the Company does not hold any derivative instruments.
The Internal Control System consists of the sets of rules, the procedures and the organisation structures that seek to ensure compliance with the business strategies and the achievement of effective and efficient processes, the safeguarding of assets and the protection from losses, the reliability, completeness and accuracy of accounting and operational information, and to ensure that transactions comply with the law, supervisory regulations, and the internal policies, plans, regulations and procedures.
The Internal Control System is structured on the following three levels:
During 2016, Consolving performed planned audits and prepared specific reports that were presented to the Board of Directors and the Board of Statutory Auditors. No significant weaknesses were identified and the deficiencies identified in previous audits were corrected.
Risk Management, which is incorporated in the activities of the Risk Control Function, has been in operation since 2010. It is responsible for identifying, evaluating and monitoring all risks related to the activities performed by the Company, highlighting the overall risks that the Company is exposed to through periodic reports. The second and third level controls have not revealed any significant anomalies. Nevertheless, the recommendations provided were acknowledged.
The Supervisory Body 231 (Legislative Decree 231/2001) issued periodic reports to the Board of Statutory Auditors and the Board of Directors. No weaknesses were identified in 2016.
Significant events occurring after the close of the financial year are listed below:
Taking into account the positive economic situation and the continuing difficulty that public entities have in paying their debts within the due date, it is reasonable to expect continued growth in the sector in 2017.
In connection with the merger of the Company in Banca Sistema, an individual operating budget was not prepared for 2017.
This document represents that last individual financial statements of the Company due to the merger by incorporation in Banca Sistema which became effective for legal and tax purposes beginning on 1 January 2017.
Dear Shareholders,
We ask you to approve the Financial Statements for the year ended 31 December 2016, with net income after tax of Euro 2,734,882.
Taking into account the merger by incorporation of the Company in Banca Sistema, the allocation of the profits on an individual level does not need to be proposed.
Milan, 8 March 2017
On behalf of the Board of Directors The Chairman
| In € | |||
|---|---|---|---|
| Assets | 31/12/2016 | 31/12/2015 | |
| 10 | Cash and cash equivalents | 1,762 | 1,937 |
| 40 | Available-for-sale financial assets | ||
| 60 | Loans and receivables | 83,454,122 | 105,580,711 |
| with banks | 14,360,698 | 28,765,262 | |
| with customers | 69,093,424 | 76,815,448 | |
| 100 | Property and equipment | 30,533 | 96,352 |
| 110 | Intangible assets | 13,656 | 23,728 |
| 120 | Tax assets | 4,800,230 | 2,457,456 |
| a) current | 2,420,856 | 46,795 | |
| b) deferred | 2,379,375 | 2,410,661 | |
| including as per Law no. 214/2011 | 1,272,761 | 1,339,749 | |
| 140 | Other assets | 1,227,385 | 1,598,622 |
| Total assets | 89,527,688 | 109,758,805 |
| Liabilities and equity | 31/12/2016 | 31/12/2015 | |
|---|---|---|---|
| 10 | Financial liabilities | 19,575,096 | 39,373,515 |
| 70 | Tax liabilities: | 5,913,856 | 5,230,561 |
| a) current | 1,074,849.86 | 16,861 | |
| b) deferred | 4,839,006 | 5,213,700 | |
| 90 | Other liabilities | 1,470,392 | 3,056,938 |
| 100 | Post-employment benefits | 357,830 | 414,072 |
| 110 | Provisions for risks and charges: | 500,000 | - |
| b) other provisions | 500,000 | - | |
| 120 | Share capital | 47,000,000 | 47,000,000 |
| 160 | Reserves | 12,068,697 | 11,928,617 |
| 170 | Valuation reserves | (93,064) | (46,493) |
| 180 | Profit (Loss) for the year | 2,734,882 | 2,801,596 |
| Total liabilities and equity | 89,527,688 | 109,758,805 |
In €
| Items | 31/12/2016 | 31/12/2015 | |
|---|---|---|---|
| 10 | Interest and similar income | 4,962,193 | 5,132,023 |
| 20 | Interest and similar expense | (516,102) | (1,593,796) |
| Net interest income | 4,446,091 | 3,538,227 | |
| 30 | Fee and commission income | 1,311,514 | 1,275,020 |
| 40 | Fee and commission expense | - | - |
| Net fee and commission income | 1,311,514 | 1,275,020 | |
| Total income | 5,757,606 | 4,813,247 | |
| 100 | Net impairment losses/reversals of impairment losses on: | 1,340,618 | 3,113,045 |
| a) financial assets | 1,340,618 | 3,113,045 | |
| b) other financial transactions | - | - | |
| 110 | Administrative expenses: | (3,046,656) | (3,683,412) |
| a) personnel expenses | (1,659,837) | (1,971,853) | |
| b) other administrative expenses | (1,386,819) | (1,711,559) | |
| 120 | Depreciation and net impairment losses on property and equipment | (12,912) | (32,430) |
| 130 | Amortisation and net impairment losses on intangible assets | (17,222) | (54,431) |
| 150 | Net accruals to provisions for risks and charges | (500,000) | 0 |
| 160 | Net other operating expense | (55,110) | (84,379) |
| PRE-TAX PROFIT (LOSS) FROM CONTINUING OPERATIONS |
3,466,324 | 4,071,640 | |
| 190 | Income taxes on continuing operations | (731,442) | (1,270,045) |
| PROFIT (LOSS) FOR THE YEAR | 2,734,882 | 2,801,596 |
In €
| 2016 | 2015 | ||
|---|---|---|---|
| 10 | Profit for the year | 2.734.882 | 2.801.596 |
| Other comprehensive income/(expense), net of income tax, that will not be reclassified subsequently to profit | |||
| or loss | |||
| 20 | Property and equipment | ||
| 30 | Intangible assets | ||
| 40 | Defined benefit plans | (46.571) | 7.047 |
| 50 | Non-current assets held for sale | ||
| 60 | Portion of valuation reserves of equity-accounted investees | ||
| Other comprehensive income/(expense), net of income tax, that will be reclassified subsequently to profit or loss | |||
| 70 | Hedges of investments in foreign operations | ||
| 80 | Exchange rate gains/(losses) | ||
| 90 | Cash flow hedges | ||
| 100 | Available-for-sale financial assets | ||
| 110 | Non-current assets held for sale | ||
| 120 | Portion of valuation reserves of equity-accounted investees | ||
| 130 | Total other comprehensive income/(expense), net of income tax | (46.571) | 7.047 |
| 140 | Comprehensive income (items 10+130) | 2.688.311 | 2.808.643 |
| Changes of the year | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Allocation of prior year profit | Equity transactions | ||||||||||||
| Balance at 31.12.2015 | Adjustment to opening balance | Balance at 1.1.2016 | Reserves | Dividends and other allocations |
Changes in reserves | Issue of new shares | Repurchase of treasury shares |
extraordinary dividends Distribution of |
Change in equity instruments |
Other changes | Comprehensive income for 2016 |
Equity at 31 December 2016 | |
| Share capital: | 47.000.000 | 47.000.000 | 47.000.000 | ||||||||||
| Share premium | - | - | - | ||||||||||
| Reserves: | 11.928.617 | 11.928.617 | 140.080 | 0 | 12.068.697 | ||||||||
| a) income-related | |||||||||||||
| b) other | 11.928.617 | 11.928.617 | 140.080 | 12.068.697 | |||||||||
| Valuation reserves: | (46.493) | (46.493) | (46.571) | (93.064) | |||||||||
| Equity instruments | 0 | ||||||||||||
| T reasury shares (-) | 0 | ||||||||||||
| Profit for the year | 2.801.596 | 2.801.596 | (140.080) | (2.661.516) | 2.734.882 | 2.734.882 | |||||||
| Equity | 61.683.720 | 61.683.720 | - | (2.661.516,20) | (46.571) | - | - | - | - | - | 2.734.882 | 61.710.515 |
| Changes of the year | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Allocation of prior year profit | Equity transactions | ||||||||||||
| Balance at 31.12.2014 | Adjustment to opening balance | Balance at 1.1.2015 | Reserves | Dividends and other allocations |
Changes in reserves | Issue of new shares | Repurchase of treasury shares |
extraordinary dividends Distribution of |
Change in equity instruments |
Other changes | Comprehensive income for 2015 |
Equity at 31 December 2015 | |
| Share capital: | 47.000.000 | 47.000.000 | 47.000.000 | ||||||||||
| Share premium | |||||||||||||
| Reserves: | 7.823.375 | 7.823.375 | 4.105.241 | 11.928.617 | |||||||||
| a) income-related | |||||||||||||
| b) other | 7.823.375 | 7.823.375 | 4.105.241 | 11.928.617 | |||||||||
| Valuation reserves: | (53.540) | (53.540) | 7.047 | (46.493) | |||||||||
| Equity instruments | |||||||||||||
| T reasury shares (-) | |||||||||||||
| Profit for the year | 4.105.241 | 4.105.241 | (4.105.241) | 2.801.596 | 2.801.596 | ||||||||
| Equity | 58.875.077 | 58.875.077 | - | 7.047 | 2.801.596 | 61.683.720 |
| A. OPERATING ACTIVITIES | Amount | |
|---|---|---|
| 2016 | 2015 | |
| 1. Operations | (493.533) | (1.913.552) |
| - profit for the year (+/-) | 2.734.882 | 2.801.596 |
| - gains/losses on financial assets held for trading | ||
| - financial assets/liabilities measured at fair value (-/+) | ||
| - gains/losses on hedges (-/+) | ||
| - net impairment losses/net reversals of impairment losses (+/-) | (1.349.837) | (7.660.233) |
| - net impairment losses on property and equipment and intangible assets (+/-) | 75.891 | 63.454 |
| - net accruals to provisions for risks and charges and other income/expense (+/-) | 500.000 | |
| - taxes and tax credits still to be paid (+/-) | ||
| - net impairment losses/net reversals of impairment losses on disposal groups, net of the tax effect (+/-) | ||
| - other adjustments (+/-) | (2.454.470) | 2.881.631 |
| 2. Cash flows generated by financial assets | 9.325.104 | 15.462.757 |
| - financial assets held for trading | ||
| - financial assets at fair value through profit or loss | ||
| - available-for-sale financial assets | 28.000 | |
| - loans and receivables with banks | ||
| - loans and receivables with financial institutions | ||
| - loans with customers | 8.953.868 | 15.349.840 |
| - other assets | 371.237 | 84.917 |
| 3. Cash flows used by financial liabilities | (20.574.742) | (41.637.381) |
| - due to banks | ||
| - due to financial institutions | (16.175.158) | (22.186.357) |
| - due to customers | (3.623.210) | (12.684.475) |
| - securities issued | ||
| - financial liabilities held for trading | ||
| - financial liabilities at fair value through profit or loss | ||
| - other liabilities | (776.374) | (6.766.549) |
| Net cash flows used by operating activities | (11.743.171) | (28.088.176) |
| B. INVESTING ACTIVITIES | ||
| 1. Cash flows generated by | 0 | 0 |
| - sales of equity investments | ||
| - dividends collected | ||
| - sales of held-to-maturity investments | ||
| - sales of property and equipment | ||
| - sales of intangible assets | ||
| - sales of business units | ||
| 2. Cash flows used by | 0 | (11.892) |
| - acquisitions of equity investments | ||
| - acquisitions of held-to-maturity investments | ||
| - purchases of property and equipment | (11.892) | |
| - purchases of intangible assets | ||
| - purchases of business units | ||
| Net cash flows generated/(used) by investing activities | 0 | (11.892) |
| C. FINANCING ACTIVITIES | ||
| - issue/repurchase of treasury shares | (310.086) | |
| - issue/purchase of equity instruments | ||
| - distribution of dividends and other allocations | (2.661.516) | |
| Net cash flows used by financing activities | (2.661.516) | (310.086) |
| NET CASH FLOWS OF THE YEAR | (14.404.687) | (28.410.154) |
| Amount | ||
|---|---|---|
| 2016 | 2015 | |
| Cash and cash equivalents at the beginning of the year | 28,767,199 | 57,177,353 |
| Total net cash flows of the year | (14,404,739) | (28,410,154) |
| Cash and cash equivalents at year end | 14,362,460 | 28,767,199 |
Notes to the financial statements
Section 4 - Other matters
Pursuant to Regulation (EC) no. 1606/2002, Beta Stepstone S.p.A. (the "company") has prepared these financial statements as at and for the year ended 31 December 2016 in compliance with the International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) endorsed by the European Commission up to 31 December 2016.
The financial statements have also been prepared in accordance with the Bank of Italy's "Instructions for the preparation of the financial statements of financial intermediaries" which apply as of the year ended or ending 31 December 2016, issued in its Measure of 9 December 2016.
Unless otherwise established by the Bank of Italy's special regulation, the information provided in these notes reflects the Italian Civil Code's provisions governing financial statements.
These financial statements comprise:
These financial statements are consistent with the company's accounting records.
The financial statements have been prepared in accordance with measurement criteria adopted on the basis of a going concern assumption also considering the company's merger into Banca Sistema and in compliance with accruals-based accounting, the materiality of information and the predominance of substance over form.
The amounts presented in these financial statements have been calculated in accordance with the IFRS issued by the International Accounting Standard Board (IASB) and endorsed by the European Commission up to 31 December 2016 pursuant to Regulation (EC) no. 1606 of 19 July 2002.
For the purposes of facilitating the interpretation and application of the new accounting standards, reference was also made to the following documents, although not yet endorsed by the European Commission:
Finally, again with respect to interpretation, where applicable, reference was also made to the documents about the adoption of the IFRS in Italy, issued by the Italian accounting standard setter (OIC) and the Italian banking association (ABI). Specifically, reference was made to Document 7 by Bank of Italy/Consob/Ivass issued on 9 November 2016 on the accounting treatment of default interest pursuant to Legislative decree no. 231/2002 on performing loans factored without recourse.
In accordance with article 5 of Legislative decree no. 38/2005, the company's reporting currency is the Euro. The amounts shown in the financial statements and these notes are in thousands of Euros.
The financial statements present the figures for 2016 with previous year corresponding figures.
For the purposes of the information disclosed in these notes, all financial statements captions are presented at 31 December 2016 and 2015, broken down as required by the Bank of Italy's instructions.
Banca Sistema's Board of Directors approved these financial statements on 8 March 2017. Indeed, the company's merger into Banca Sistema became fully operational and effective for legal and tax purposes on 1 January 2017.
After this date, no facts or circumstances occurred that had an impact on the financial position and performance described herein.
The following table sets out the new standards or amendments to existing standards, with the related endorsement regulations issued by the European Commission, which became applicable in 2016.
IAS/IFRS standards and related IFRIC interpretations applicable to annual periods beginning after 1 January 2016:
| Name | Issue date | Date of application | Date of endorsement |
EU regulation and issue date |
Notes and references to this list |
|---|---|---|---|---|---|
| IFRS 15 – Revenue from | May 2014 | 1 January 2018 | 22 September | (EU) 2016/1905 | Early |
| contracts with customers | (Note 1) | 2016 | 29 October | application is | |
| 2016 | permitted. | ||||
| See 460-481 |
Documents endorsed by the EU at 31 October 2016
Documents not yet endorsed by the EU at 31 October 2016
| Name | Issue date by the IASB |
Date of application of the IASB document |
Expected date of endorsement by the IASB |
||
|---|---|---|---|---|---|
| Standards | |||||
| IFRS 9 - Financial Instruments | July 2014 | 1 January 2018 | IV quarter of 2016 | ||
| IFRS 14 - Regulatory Deferral Accounts | January 2014 | (Note 1) | (Note 1) | ||
| IFRS 16 - Leases | January 2016 | 1 January 2019 | 2017 | ||
| Amendments | |||||
| Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture |
September 2014 |
Postponed until completion of the IASB project on the equity method |
Postponed pending the completion of the IASB project on the equity method |
| Amendments to IAS 12: Recognition of Deferred Tax Assets for Unrealised Losses |
January 2016 | 1 January 2017 | IV quarter of 2016 |
|---|---|---|---|
| Amendments to IAS 7: Disclosure Initiative |
January 2016 | 1 January 2017 | IV quarter of 2016 |
| Clarifications to IFRS 15 - Revenue from Contracts with Customers |
April 2016 | 1 January 2018 | I half of 2017 |
| Amendments to IFRS 2: Classification and Measurement of Share-based Payment Transactions |
June 2016 | 1 January 2018 | II half of 2017 |
| Amendments to IFRS 4: Applying IFRS 9 Financial Instruments with IFRS 4 Insurance Contracts |
September 2016 |
1 January 2018 | 2017 |
The amendments to the standards and interpretations endorsed by the European Commission in 2016 or in prior years, whose application became mandatory as of 2016, had no significant impacts on the preparation of these financial statements.
IFRS 9 was adopted on 29 November 2016 with the publication of (EU) Regulation 2016/2067 of the European Commission dated 22 November 2016 on the Official Journal of the European Union. This standard will apply to annual periods beginning on or after 1 January 2018.
It will replace IAS 39 and will govern the accounting of financial instruments as summarised below:
months, while for the other two stages with a lower credit standing, calculation of the expected loss is carried out for the residual term of the financial asset ("lifetime expected loss").
• Hedge accounting: the hedging models set out in IFRS 9 are generally simplified compared to those in IAS 39 and introduce a stronger link with risk management.
Based on the proposed merger of the company into Banca Sistema as of 1 January 2017, the introduction of these changes to the reference framework will have no impact on Beta Stesptone S.p.A.'s financial position.
Loans and receivables consist of financial assets with banks and customers.
Loans and receivables with customers refer to the factoring transactions completed in accordance with a regular assignment deed notified to the transferred debtor. They comprise:
There were no reclassifications to other financial asset categories in accordance with IAS 39.
Loans and receivables are initially recognised at the agreement signing date, based on fair value, which equals the amount disbursed or the purchase price, including transaction costs or revenue attributable to the individual loan or receivable and determinable from the transaction start date, even when paid subsequently. The initially recognised amount does not include costs that, despite having the above characteristics, are to be reimbursed by the counterparty or that are administrative costs.
Loans and receivables are subsequently measured at amortised cost, being the initially recognised amount decreased/increased by principal repayments, reversals of impairment losses/impairment losses and amortisation - calculated using the effective interest method - of the differential between the amount disbursed and that collectable at maturity for each loan/receivable. The effective interest rate considers the present value of the future cash flows and the amount disbursed, inclusive of the cost/income related to the loan/receivable. According to this accounting method, the economic effect of income is allocated over the expected residual life of the loan/receivable.
The amortised cost method is not used for current loans and receivables for which the discounting effect of cash flows would be negligible. They are measured on a historical cost basis.
Default interest receivables are recognised on an accruals basis and adjusted to their expected recoverable amount, considering the percentages of effective realisation in prior years. Default interest is recognised only after court confirmation (not when the default arises) which sets the rate to be applied (ECB + approx. 800 bps or the legal rate) and the effective date.
Loans and receivables are tested for impairment to determine whether there is objective evidence of impairment due to events subsequent to initial recognition. This includes loans and receivables classified as "non-performing, unlikely to pay or past due/overdue" as per the Bank of Italy's instructions in line with IAS/IFRS.
The individual impairment test measures the difference between the carrying amount (at amortised cost) and present value of estimated future cash flows discounted at the position's original effective interest rate and considering both the expected collection time and the enforcement value of guarantees, if any, and the costs to be incurred for enforcement.
The original effective rate of each loan and receivable is unchanged over time. Impairment losses are taken to profit or loss. Loans and receivables are reinstated to their original value in subsequent periods when the reasons for impairment are no longer valid, as long as this assessment is objectively linked to an event that took place after recognition of the impairment loss. Reversals of impairment losses are recognised in the income statement and shall never exceed the position's amortised cost had the impairment loss not been recognised.
Loans and receivables that are not tested individually for impairment are tested collectively. They are grouped into categories and the expected losses are estimated considering historical data and other elements observable at their measurement date. The impairment test considers the counterparty's country risk.
Collective impairment losses are recognised in profit or loss.
Loans and receivables are derecognised only when their transfer entails the substantial transfer of all the risks and rewards of ownership. Conversely, when the company retains a significant portion of the risks and rewards related to the transferred loans and receivables, these will continue to be recognised in the financial statements, although, legally, title to the financial asset was actually transferred.
If the substantial transfer of risks and rewards cannot be verified, the financial assets are derecognised when the company has not retained control of the transferred asset. Conversely, if the company has retained control, including in part, it shall continue to recognise the financial asset to the extent of the expected changes in the carrying amount and the estimated changes in cash flows.
Finally, transferred financial assets are derecognised when the right to receive the related cash flows, with the concurrent obligation of transferring them to third parties, is retained.
Due to customers (comprised of the second instalments of the without-recourse factoring of receivables which are paid only upon full collection) are recognised, measured and derecognised in accordance with the same criteria applicable to loans with customers. Indeed, they originate from the same contract and their settlement date coincides with the collection date of the receivable factored.
Due to banks and financial institutions are recognised at their nominal amount as they refer to ondemand current account deposits.
This caption comprises movable and immovable assets, systems, other machinery and equipment owned for use by the company. Initial recognition is at cost, which includes all charges directly related to the operation of the asset.
Ordinary maintenance costs are expensed.
Property and equipment are measured at cost adjusted by accumulated depreciation calculated on a straight-line basis over the residual life of the asset.
An item of property and equipment is derecognised when sold or when it is permanently withdrawn from use and the company does not expect any future economic benefits from its disposal.
Intangible assets mainly comprise software or costs related to leasehold improvements.
Intangible assets are measured at cost adjusted by accumulated
amortisation calculated on a straight-line basis over the residual life of the asset.
Intangible assets are derecognised upon disposal or when the asset is permanently withdrawn from use.
Income taxes are calculated in accordance with national tax legislation and are recognised on an accruals basis, in line with the recognition criteria applicable to the cost and revenue that generated them. Therefore, they represent the balance of the current and deferred taxation related to the year's income.
Current tax assets and liabilities include the net balance of the company's tax position vis-à-vis Italy's tax authorities.
Deferred taxes are calculated using the balance sheet liability method, considering the tax effect of the temporary differences between the carrying amounts of assets and liabilities and their tax bases which generate taxable or deductible amounts in future periods. To this end, "taxable temporary differences" are those that will generate taxable amounts in future years and "deductible temporary differences" are those that will generate deductible amounts in future years.
Deferred tax liabilities are calculated by applying the tax rates set by the law to the taxable temporary differences whose realisation is deemed probable and to deductible temporary differences for which the existence of taxable amounts when the related tax deductibility occurs is reasonably certain.
In the years when the deductible temporary differences exceed the taxable temporary differences, the related deferred tax assets are recognised in the statement of financial position under Deferred tax assets. Conversely, in the years when the taxable temporary differences exceed the deductible temporary differences, the related deferred tax assets are recognised in the statement of financial position under Deferred tax liabilities.
When the deferred tax assets and liabilities refer to the items that have an impact on the income statement, the balancing entry is represented by income taxes.
When the deferred tax assets and liabilities refer to transactions that had a direct impact on equity without affecting the income statement (such as IFRS first-time adoption adjustments), these are recognised as a balancing entry in equity, under specific reserves where required.
Post-employment benefits are recognised at their actuarial amount, calculated using the project unit credit method based on statistical historical analyses, the demographic curve and the discounting of future disbursements, applying market interest rates.
Until 31 December 2012, actuarial gains and losses were entirely recognised in the income statement in accordance with the previous version of IAS 19.
Following the coming into force of the new version of IAS 19 issued by the IASB in June 2011, application of which became mandatory on 1 January 2013, actuarial gains and losses are immediately and entirely recognised in the "Statement of comprehensive income" with an impact on equity. As the corridor approach has never been applied, the prudential filters established by the Bank of Italy in its communication dated 8 May 2013 in terms of regulatory capital do not apply.
The present value of the company's commitments is calculated by an independent expert using the projected unit credit method.
The annual discount rate applied is based on a rate deductible from securities or equivalent instruments, with an AA rating which is deemed to best reflect market yields, and considering the average term of the liability.
They include income and expense pertaining to the year accrued on assets and liabilities and are recognised as an adjustment to the assets and liabilities to which they refer.
"Provisions for risks and charges: b) other provisions" include liabilities whose amount or due date are uncertain. They are recognised when the following conditions are met:
other operation of law) or constructive (i.e., it derives from an entity's action where the entity has created a valid expectation on the part of other parties that it will discharge its responsibilities);
Revenue is recognised when received or, in the event of provision of services, when the future benefits can be quantified reliably when rendered.
Specifically, interest is recognised on an accruals basis based on the contractually-agreed rate or the effective interest rate when the amortised cost method is applied.
Default interest income, recognised only after court confirmation and the definition of the rate to be applied (ECB+800 bp or legal rate), is recognised on an accruals basis and prudently adjusted to take into account the possibility of a settlement agreement with the debtors. However, the company usually fully recovers it before the court.
Costs are recognised in the income statement in the same period the related revenue is recognised. When cost and revenue can be matched generically and indirectly, costs are recognised over several periods using rational procedures and on a systematic basis. Costs that cannot be matched to revenue are immediately recognised in the income statement.
The preparation of financial statements also involves the use of estimates and assumptions that may have a significant effect on the carrying amount of assets and liabilities, income and expenses and the related disclosure. The preparation of estimates involves using the available information and adopting subjective valuations, based on past experience, in order to arrive at reasonable assumptions to present operations. Because of their nature, the estimates and assumptions used may change from one year to the next. Consequently, it cannot be excluded that, in future years, the amounts recognised change, also significantly, as a consequence of changes in the subjective valuations applied due to unforeseeable facts/events.
Specifically, subjective valuations refer to:
Amortised cost is the amount at which a financial asset or financial liability is measured at initial recognition minus principal repayments, plus or minus the cumulative amortisation using the effective interest rate method of any difference between the initial amount and the maturity amount and minus any reduction for impairment.
The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument or, when appropriate, a shorter period to the net carrying amount of the financial asset or financial liability.
Subsequent to initial recognition, under the amortised cost, costs and revenue are allocated as a decrease or an increase in the asset/liability over the entire useful life through amortisation.
Given the nature of the loans and receivables in portfolio, the company calculates the effective interest rate for each invoiced acquired, estimating the collection date based on available information and the progress of the credit collection procedures. Each time these estimates are revised, the company recalculates the amortisation plan of financial assets and financial liabilities, taking the adjustment to profit or loss.
The amortised cost method is applied to loans and receivables and liabilities with customers, provided that the loans/receivables and the liability with the company originate from the same contract and the settlement date mainly coincides with the collection date of the receivable factored.
Default interest income, recognised only after court confirmation, is adjusted to its estimated recoverable amount, considering the percentages of effective realisation in prior years.
At each reporting date, financial assets other than those classified as Held for trading and as Measured at fair value are tested for impairment to check whether there is an objective evidence of an impairment loss.
Impairment losses are recognised when there is objective evidence of a reduction in future cash flows compared to those originally estimated, due to unforeseeable specific events.
Impairment tests are carried out on individual financial assets which show specific evidence of impairment or collectively in the case of financial assets which do not require individual assessment or for which this assessment does not indicate an impairment.
Collective assessment is based on the identification of consistent risk classes of financial assets based on the characteristics of the debtor/issuer, the business segment, the geographical segment and the existence of any guarantees or other significant factors.
Loans and receivables with banks and customers are assessed individually when they are nonperforming, unlikely to pay or past due/overdue as per the Bank of Italy's definitions in line with IAS/IFRS.
They are measured individually, or by determining the expected loss by consistent categories and analytical allocation to individual positions. The impairment loss on each loan and receivable is equal to the difference between the carrying amount at amortised cost and the present value of the expected future cash flows, calculated by applying the original effective interest rate.
Future cash flows consider the expected collection times, the expected enforcement value of any guarantees and the costs that may incurred for recovery. The cash flows related to loans and receivables whose recovery is not expected in the short term are not discounted as the amount of the differential would be negligible.
The loans and receivables for which no individual objective evidence of impairment has been identified are subject to collective assessment.
IFRS 13 and the Bank of Italy's regulations for the preparation of banks' financial statements require that assets and liabilities be recognised at their fair value when they refer to a specific hierarchy based on the nature of the inputs used to determine the following "fair value levels":
It includes the instruments which can be measured using prices in active markets (effective market quotes). In this case, the fair value is equal to the price at which the financial instrument would be exchanged at the reporting date (with no adjustments) on the main active market, or when no main market exists, on the market deemed most advantageous to which the entity has immediate access.
It includes the instruments which can be measured using inputs – other than the quoted prices included within Level 1 – that are observable for the asset or liability, either directly or indirectly.
This measurement is based on prices or credit spreads deducted from the official quotes of active markets of instruments substantially similar in terms of risk factors (comparable approach), using an appropriate calculation methodology (pricing model). The methodologies used in the comparable approach reproduce the prices of the instruments quoted on active markets excluding discretionary parameters, such to have a major effect on the final measurement price.
When the fair value measurement uses observable data that require a significant adjustment based on unobservable inputs, the measurement is included in Level 3.
It includes unobservable inputs. The related fair value is based on measurements that entail estimates and assumptions by the assessor (mark to model). Measurement takes place using pricing models that are based on specific assumptions concerning:
As mentioned earlier, fair value is calculated for the sole purposes of the mandatory disclosure to be provided in the notes to the financial statements.
The fair value of the financial instruments included in the tables of these notes was calculated using the following methods and assumptions:
A.4.5.1 Assets and liabilities measured at fair value on a recurring basis: breakdown by fair value level
None.
A.4.5.2 Changes in assets measured at fair value on a recurring basis (level 3)
None.
A.4.5.3 Changes in liabilities measured at fair value on a recurring basis (level 3)
The company has liabilities measured at fair value on a recurring basis.
| Attività/Passività finanziarie misurate al fair value | Livello 1 | Livello 2 | Livello 3 | Totale |
|---|---|---|---|---|
| 1. Attività finanziarie detenute per la negoziazione | - | |||
| 2. Attività finanziarie valutate al fair value | - | |||
| 3. Attività finanziarie disponibili per la vendita | - | - | ||
| 4. Derivati di copertura | - | |||
| 5. Attività materiali | ||||
| 6. Attività immateriali | ||||
| Totale | - | - | - | - |
| 1.Passività finanziarie detenute per la negoziazione | - | |||
| 2. Passività finanziarie valutate al fair value | - | |||
| 3. Derivati di copertura | - | |||
| Totale | - | - | - | - |
A.4.5.4 Assets and liabilities not measured at fair value or measured at fair value on a non-recurring basis: breakdown by fair value level
| 31.12.2016 | 31.12.2015 | |||||||
|---|---|---|---|---|---|---|---|---|
| CA | L1 | L2 | L3 | VB | L1 | L2 | L3 | |
| 1. Held-to-maturity investments | - - | - | - | - | - | - | ||
| 2. Loans and receivables | 83.454 | - | - | 83.454 | 105.581 | - | - | 105.581 |
| 3. Investment property | - - | - | - | - | - | |||
| 4. Non current assets held for sale and disposal groups | - - | - | - | - | - | |||
| Total | 83.454 | - | - | 83.454 | 105.581 | - | - | 105.581 |
| 1. Liabilities | 19.575 | - | - | 19.575 | 39.374 | - | - | 39.374 |
| 2. Securities issued | - - | - | - | - | - | - | ||
| 3. Liabilities associated with disposal groups | - - | - | - | - | - | - | ||
| Total | 19.575 | - | - | 19.575 | 39.374 | - | - | 39.374 |
Legenda: VB=Valore di bilancio L1= Livello 1 L2= Livello 2 L3= Livello 3
Figures in '000
The company did not recognise transactions of this kind in the year.
| Items/Values | Total 2016 | Total 2015 |
|---|---|---|
| a) Cash | 2 | 2 |
| b) Other | - | - |
| Total | 2 | 2 |
Figures in '000
This is the cash balance at 31 December 2016.
| 31/12/2016 | 31/12/2015 | |||||||
|---|---|---|---|---|---|---|---|---|
| Carrying amount | Fair value | Carrying amount | Fair value | |||||
| L1 | L2 | L3 | L1 | L2 | L3 | |||
| 1. Deposits and current accounts | 14.361 | 14.361 | 28.765 | 28.765 | ||||
| 2. Financing: | ||||||||
| 2.1 Reverse repurchase agreements | ||||||||
| 2.2 Finance leases | ||||||||
| 2.3 Factoring | ||||||||
| - with recourse | ||||||||
| - without recourse | ||||||||
| 2.4 Other financing | ||||||||
| 3. Debt instruments | ||||||||
| - structured instruments | ||||||||
| - other debt instruments | ||||||||
| 4. Other assets | ||||||||
| Total | 14.361 | 14.361 | 28.765 | 28.765 |
Figures in '000
Current account deposits are held with the following banks:
| Figures in '000 | 31/12/2016 | 31/12/2015 | Absolute change |
|---|---|---|---|
| Banca Sistema | 14,295 | - | 14,295 |
| Unicredit S.p.A | 23 | 2,563 | -2,540 |
| Banca Credito Popolare Torre del Greco | 43 | 8,107 | -8,064 |
| Veneto Banca | - | 17,103 | -17,103 |
| Unicredit Factoring (term deposit) | - | 992 | -992 |
| Total | 14,361 | 28,765 | -14,404 |
None.
| 31/12/2016 | 31/12/2015 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Carrying amount | Fair value | Carrying amount | Fair value | |||||||||
| Performing | Impaired | L1 | L2 | L3 | Impaired | L1 | L2 | L3 | ||||
| Purchased | Other | Performing | Purchased | Other | ||||||||
| 1. Financing | - 65.221 | 3.794 | - | - | 69.015 | 74.304 | - | 2.324 | - | - | 76.628 | |
| 1.1. Finance lease | - - | - | - | - | - | - | - | - | - - | - | ||
| of which: without final purchase option | - - | - | - | - | - | - | - | - | - - | - | ||
| 1.2. Factoring | 65.221 | - | 3.794 | - - | 69.015 | 74.304 | - | 2.324 | - - | 76.628 | ||
| - with recourse | 7.968 | - | 3.564 | - - | 11.532 | 11.647 | - | 1.880 | - - | 13.527 | ||
| - without recourse | 57.253 | - | 231 | - - | 57.483 | 62.657 | - | 445 | - - | 63.101 | ||
| 1.3. Consumer loans | - | - | - | - - | - - | - | - | - - | - | |||
| 1.4. Credit cards | - | - | - | - - | - - | - | - | - - | - | |||
| 1.5. Pawn loans | - | - | - | - - | - - | - | - | - - | - | |||
| 1.6 Financing granted in relation to service payments rendered | - | - | - | - - | - - | - | - | - - | - | |||
| 1.7. Other financing | - | - | - | - - | - - | - | - | - - | - | |||
| of which: from enforcement of guarantees and commitments | - | - | - | - - | - - | - | - | - - | - | |||
| 2. Debt instruments | - | - | - | - - | - - | - | - | - - | - | |||
| 2.1 structured instruments | - | - | - | - - | - - | - | - | - - | - | |||
| 2.2 other debt instruments | - | - | - | - - | - - | - | - | - - | - | |||
| 3. Other assets | 78 | - | - | - - | 78 | 187 | - | - | - - | 187 | ||
| Total | 65.299 | 0 | 3.794 | 0 | 0 | 69.093 | 74.491 | 0 | 2.324 | 0 | 0 | 76.815 |
Figures in '000
At 31 December 2016, this item comprised:
The item is broken down below as follows:
| Loans and receivables with customers | 31/12/2016 | 31/12/2015 |
|---|---|---|
| Loans and receivables factored without recourse | 43,724,815 | 49,518,377 |
| With recourse advances Lump-sum adjustment to without-recourse loans and |
11,531,691 | 13,526,918 |
| receivables | (401,717) | (910,935) |
| Other loans and receivables/returns, performing Doubtful loans and receivables/unlikely to pay |
745,121 | 187,047 |
| exposures Impairment losses on doubtful loans and |
440,192 | 503,036 |
| receivables/unlikely to pay exposures | (209,664) | (250,000) |
| Loans and receivables for default interest | 16,578,894 | 17,799,012 |
| Lump-sum adjustments to default interest | (3,315,908) | (3,558,005) |
| Total loans and receivables with customers | 69,093,424 | 76,815,448 |
None.
10.1 Breakdown of item 100 "Property and equipment"
"Property and equipment" amount to Euro 31 thousand. The breakdown of this item and the changes therein are described below.
| 10.1 Property and equipment used in operations: breakdown of assets measured at cost | |||
|---|---|---|---|
| Activities/Values | Total 2016 | Total 2015 |
|---|---|---|
| 1. Owned | 31 | 97 |
| a) land | ||
| b) buildings | ||
| c) furniture | 8 | 87 |
| d) electronic systems | 23 | 10 |
| e) other | ||
| 2. Under finance lease | ||
| a) land | ||
| b) buildings | ||
| c) furniture | ||
| d) electronic systems | ||
| e) other | ||
| Total | 31 | 97 |
| Land | Buildings | Furniture | Electronic | Other | Total | |
|---|---|---|---|---|---|---|
| systems | ||||||
| A. Gross opening balance |
165 | 131 | 296 | |||
| A.1 Total net impairment losses | (79) | (121) | (200) | |||
| A.2 Net opening balance | 87 | 10 | 97 | |||
| B. Increases |
- | 39 | 39 | |||
| B.1 Purchases | - | - | - | |||
| B.2 Capitalised improvement costs | ||||||
| B.3 Reversals of impairment losses | ||||||
| B.4 Fair value gains recognised in: | ||||||
| a) equity | ||||||
| b) profit or loss | ||||||
| B.5 Exchange rate gains | ||||||
| B.6 Transfers from investment property | ||||||
| B.7 Other increases | 39 | 39 | ||||
| C. Decreases | (78) | (26) | (105) | |||
| C.1 Sales | ||||||
| C.2 Depreciation | (8) | (6) | (14) | |||
| C.3 Impairment losses recognised in: | ||||||
| a) equity | ||||||
| b) profit or loss | ||||||
| C.4 Fair value losses recognised in: | ||||||
| a) equity | ||||||
| b) profit or loss | ||||||
| C.5 Exchange rate losses | ||||||
| C.6 Transfers to: | ||||||
| a) investment property | ||||||
| b) disposal groups | ||||||
| C.7 Other decreases | (71) | (20) | - 91 |
|||
| D. Net closing balance | 8 | 23 | 31 | |||
| D.1 Total net impairment losses | (157) | (148) | (305) | |||
| D.2 Gross closing balance | 165 | 170 | 335 | |||
| E. Measurement at cost | 8 | 23 | 31 |
Figures in '000
| Total 2016 | Total 2015 | |||
|---|---|---|---|---|
| Assets | Assets | |||
| Item/Assessment | Assets | measured at fair | Assets | measured at fair |
| measured at cost | value through | measured at cost | value through | |
| profit or loss | profit or loss | |||
| 1 Goodwill | - | - | - | - |
| 2 Other intangible assets | ||||
| 2.1. owned | 14 | - | 24 | - |
| - internally generated assets | - | - | - | - |
| - other | 14 | - | 24 | - |
| 2.2 under finance lease | - | - | - | - |
| Total 2 | 14 | - | 24 | - |
| 3. Assets related to finance leases: | ||||
| 3.1 unopted assets | - | - | - | - |
| 3.2 assets withdrawn following termination | - | - | - | - |
| 3.3 other assets | - | - | - | - |
| Total 3 | - | - | - | - |
| 4. Assets under operating lease | - | - | - | - |
| Total (1+2+3+4) | 14 | - | 24 | - |
| Total | 14 | - | 24 | - |
A breakdown of and changes therein are given below.
| Total | ||
|---|---|---|
| A. Opening balance | 24 | |
| B. Increases | 7 | |
| B.1 Purchases | - | |
| B.2 Reversals of impairment losses | ||
| B.3 Fair value gains recognised in | ||
| - equity | ||
| - profit or loss | ||
| B.4 Other increases | 7 | |
| C. Decreases | (17) | |
| C.1 Sales | ||
| C.2 Amortisation | (17) | |
| C.3 Impairment losses recognised in | ||
| - equity | ||
| - profit or loss | ||
| C.4 Fair value losses recognised in: | ||
| - equity | ||
| - profit or loss | ||
| C.5 Other decreases | ||
| D. Closing balance | 14 |
Figures in '000
| 2016 | 2015 | |
|---|---|---|
| A) Current tax assets: | 2,421 | 47 |
| a) IRAP paid on account | 329 | 0 |
| b) IRES paid on account | 2,026 | 47 |
| c) withholding taxes | 66 | 0 |
| d) DTA conversion | 0 | 0 |
| e) other | 0 | 0 |
| B) Deferred tax assets with a balancing entry in profit | ||
| or loss: | 2,359 | 2,391 |
| a) impairment losses on loans and receivables b) impairment losses on loans and receivables for |
1,273 | 1,340 |
| default interest | 946 | 1,012 |
| c) tax losses | 0 | 0 |
| d) provisions for risks | 140 | 23 |
| e) other | 0 | 16 |
| C) Deferred tax assets with a balancing entry in equity: | 20 | 20 |
| a) actuarial loss on post-employment benefits | 20 | 20 |
| Tax assets | 4,800 | 2,458 |
| 2016 | 2015 | |
|---|---|---|
| A) Current tax liabilities: | 1,075 | 17 |
| a) tax provision and IRES taxation | 773 | 0 |
| a) tax provision and IRAP taxation | 302 | 17 |
| B) Deferred tax liabilities with a balancing entry in | ||
| profit or loss: | 4,839 | 5,214 |
| a) default interest receivable not yet received | 4,755 | 5,092 |
| b) post-employment benefits | 7 | 7 |
| c) other | 77 | 115 |
| Tax liabilities | 5,914 | 5,231 |
Section 12 – Tax assets and tax liabilities – Item 120 of assets and item 70 of liabilities 12.2 Breakdown of item 70 Tax liabilities: current and deferred
Figures in '000
12.3 Changes in deferred tax assets (recognised in profit or loss)
| Total 2016 | Total 2015 | |
|---|---|---|
| 1. Opening balance | 2,390 | 4,115 |
| 2. Increases | 382 | 226 |
| 2.1 Deferred tax assets recognised in the year a) related to previous years b) due to changes in accounting policies c) reversals of impairment losses d) other 2.2 New taxes or increases in tax rates 2.3 Other increases |
382 382 |
226 10 216 |
| 3. Decreases | 413 | 1951 |
| 3.1 Deferred tax assets derecognised in the year a) reversals b) impairment due to non-recoverability c) due to changes in accounting policies d) other 3.2 Decrease in tax rates 3.3 Other decreases a) conversion into tax credits as per Law no. 214/2011 b) other |
413 413 |
1,951 1,951 |
| 4. Closing balance | 2,359 | 2,390 |
12.3.1 Change in deferred tax assets pursuant to Law no. 214/2011 (recognised in profit or loss)
| Total 2016 | Total 2015 | |
|---|---|---|
| 1. Opening balance | 1,340 | 1,340 |
| 2. Increases | ||
| 3. Decreases | 67 | 0 |
| 3.1 Reversals | 67 | 0 |
| 3.2 Conversion into tax assets | ||
| a) arising from the loss for the year | ||
| b) arising from tax losses | ||
| 3.3 Other decreases | ||
| 4. Closing balance | 1,273 | 1,340 |
Figures in '000
| Total 2016 | Total 2015 | |
|---|---|---|
| 1. Opening balance | 5,214 | 8,047 |
| 2. Increases | 830 | 1,037 |
| 2.1 Deferred taxes recognised in the year a) related to previous years b) due to changes in accounting policies c) other |
830 830 |
1,037 137 900 |
| 2.2 New taxes or increases in tax rates 2.3 Other increases |
||
| 3. Decreases | 1,205 | 3,870 |
| 3.1 Deferred taxes derecognised in the year a) reversals b) due to changes in accounting policies c) other 3.2 Decrease in tax rates 3.3 Other decreases |
1,205 1,205 |
3,870 3,870 |
| 4. Closing balance | 4,839 | 5,214 |
12.5 Change in deferred tax assets (recognised in equity)
| Total 2016 | Total 2015 | |
|---|---|---|
| Opening balance | 20 | 20 |
| 2. Increases | 0 | 0 |
| 2.1 Deferred tax assets recognised in the year | 0 | 0 |
| a) related to previous years | ||
| b) due to changes in accounting policies | ||
| c) other | ||
| 2.2 New taxes or increases in tax rates | ||
| 2.3 Other increases | ||
| 3. Decreases | 0 | 0 |
| 3.1 Deferred tax assets derecognised in the year | 0 | 0 |
| a) reversals | ||
| b) impairment due to non-recoverability | ||
| c) due to changes in accounting policies | ||
| d) other | ||
| 3.2 Decrease in tax rates | ||
| 3.3 Other decreases | ||
| 4. Closing balance | 20 | 20 |
Figures in '000
None.
On 14 December 2016, the Revenue Office notified the Company of two assessment notices regarding the 2011 tax year (one for transfer pricing for Euro 1,093 thousand , and the other for withholding taxes of Euro 1,404 thousand). No specific accrual was recognised since the Company acted in full compliance with the relevant law and intends to submit solid arguments to the competent authorities. In this respect, on 10 February 2017 and in agreement with the former Single Shareholder, Banca Sistema (which replaced Beta Stepstone as a result of the merger) filed a tax settlement proposal with the Revenue Office to establish a cross examination and emphasise the groundlessness of the claims. Indeed, the Company acted correctly in checking the fairness of the transfer pricing and in total respect of the regulatory requirements applicable to withholding taxes.
| 2016 | 2015 | |
|---|---|---|
| Loans and receivables related to the F23 form |
1,032 | 1,258 |
| Prepayments | 11 | 7 |
| Leasehold | ||
| improvements | - | 21 |
| Other | 184 | 312 |
| Total | 1,227 | 1,599 |
Other assets comprise (i) financial assets for unified contributions and registration taxes (F23), paid in advance by the Company on behalf of the debtors, which are recovered upon judicial and extrajudicial receipt of the factored loans and receivables, and (ii) receivables for legal fees paid in advance which, usually, are reimbursed by debtors at the end of the judicial or extra-judicial collection.
Prepayments are calculated on an accruals basis.
They may be analysed as follows:
| 31/12/2016 | 31/12/2015 | ||||||
|---|---|---|---|---|---|---|---|
| due to financial | due to | due to financial | due to | ||||
| due to banks | institutions | customers | due to banks | institutions | customers | ||
| 1. Financing | - | - | - | - | 1 | - | |
| 1.1 Repurchase agreements | - | - | - | - | - | - | |
| 1.2 Other financing | - | - | - | - | 1 | - | |
| 2. Other liabilities | - | - | 19.575 | - | 16.175 | 23.198 | |
| Total | - | - | 19.575 | - | 16.176 | 23.198 | |
| Fair value – level 1 | - | - | - | - | - | - | |
| Fair value – level 2 | - | - | - | - | - | - | |
| Fair value – level 3 | - | - | 19.575 | - | 16.176 | 23.198 | |
| Total fair value | - | - | 19.575 | - | 16.176 | 23.198 |
Figures in '000
Due to customers comprise the second instalments of the without-recourse purchase price of receivables pledged as collateral for the full repayment of the receivables due from each transferred debtor. These amounts are disbursed: (i) upon full collection of the receivables whose allocation is not disputed by the debtor, or (ii), where contractually provided for, provided that it is confirmed that the judicial authority's measure is no longer open to challenge. Similarly to loans and receivables with customers, financial liabilities are measured at amortised cost and discounted using the effective internal rate of return. Indeed, they originate from the same contract and the settlement date of the financial liability usually coincides with the collection date of the receivable factored.
Reference should be made to section 12 – Tax assets and liabilities.
"Other liabilities" refer to the liabilities that do not fall under the other liability items of the statement of financial position.
This caption may be analysed as follows:
| 31/12/2016 | 31/12/2015 | |
|---|---|---|
| Due to bodies for collections to be recharged | 518 | 1.787 |
| Trade payables | 203 | 451 |
| Tax authorities and social security institutions for withholdings and contributions to be paid | 104 | 168 |
| Accrued expenses on amounts due to employees | 38 | 105 |
| Other liabilities | 608 | 546 |
| Total | 1.470 | 3.057 |
Figures in '000
They refer to the amounts collected from transferred debtors and not yet reconciled due to the lack of data about the relevant receivables.
They mainly refer to invoices for services and consultancies received before the reporting date or invoices received after the reporting date, but pertaining to 2016, which will be paid as contractually agreed.
They mainly comprise accrued expenses and deferred income, calculated on an accruals basis, collections from invoices not transferred during the reversal to the assignor and the collection of legal fees to be recharged to beneficiaries.
This item changed as follows:
| Total 2016 | Total 2015 | |
|---|---|---|
| A. Opening balance | 414 | 380 |
| B. Increases | 119 | 63 |
| B.1 Accruals | 72 | 63 |
| B.2 Other increases | 47 | |
| C. Decreases | 175 | 28 |
| C.1 Payments | 97 | 21 |
| C.2 Other decreases | 77 | 7 |
| D. Closing balance | 358 | 414 |
"Post-employment benefits" are governed by article 2120 of the Italian Civil Code and include the estimate, calculated using the above-mentioned actuarial techniques, of the amount to be paid to employees upon termination of their employment contract.
Until 31 December 2012, actuarial gains and losses were entirely recognised in the income statement in accordance with the previous version of IAS 19.
Following the coming into force of the new version of IAS 19 issued by the IASB in June 2011, application of which became mandatory on 1 January 2013, actuarial gains and losses are immediately and entirely recognised in the "Statement of comprehensive income" with an impact on equity. As the corridor approach has never been applied, the prudential filters established by the Bank of Italy in its communication dated 8 May 2013 in terms of regulatory capital do not apply.
| Reporting period | 2016 |
|---|---|
| Past service liability at 1 January 2016 | 414 |
| Interest cost | 9 |
| Current service cost | 63 |
| Past service liability of newly-hired employees | |
| Utilisation | (175) |
| Actuarial (gain) or loss | 47 |
| Past service liability at 31 December 2016 | 358 |
| Post-employment benefits recognised at 31 December 2016 | 358 |
| Figures in '000 |
Post-employment benefits are broken down below in accordance with IAS 19.
11.1 Breakdown of item 110 "Provisions for risks and charges"
| 31/12/2016 | 31/12/2015 | |
|---|---|---|
| Provision for risks and charges | 500 | - |
| Total | 500 | - |
The provision was prudently accrued to cover the unfavourable outcome of some disputed loans and receivables from assignors.
| 11.2 Changes in item 110 "Provisions for risks and charges" | ||||||
|---|---|---|---|---|---|---|
| A. Opening balance | - |
|---|---|
| B. Increases | 500 |
| - accruals | 500 |
| - other increases | - |
| C. Decreases | - |
| - utilisations | - |
| - releases | - |
| - other decreases | - |
| D. Closing balance | 500 |
12.1 Breakdown of item 120 "Share capital"
| Items/Values | Total 2016 | Total 2015 |
|---|---|---|
| 1. Share capital | 47,000 | 47,000 |
| 1.1 Ordinary shares | 47,000 | 47,000 |
| 1.2 Other shares (to be specified) |
Figures in '000
The share capital is comprised of 47,000,000 ordinary shares of a nominal amount of Euro 1 each and is wholly owned by the sole shareholder Banca Sistema.
12.2 Breakdown of item 130 "Treasury shares"
None.
12.3 Breakdown of item 140 "Equity instruments"
None.
12.4 Breakdown of item 150 "Share premium"
None.
Pursuant to the Bank of Italy's circular no. 5365 of 2 January 2009, the company's equity is broken down below, with indication of the origin, availability and distributability of the various items comprising it.
| Available portion | Summary of uses in the past years | |||||
|---|---|---|---|---|---|---|
| Amount | Possible use | To cover losses | Other reasons | |||
| Share capital | 47.000 | |||||
| Legal reserve | 3.612 | (A - B) | ||||
| Statutory reserve | 10 | (A - B) | ||||
| Revaluation reserve | (93) | (A - B) | ||||
| Other reserves | 8.447 | (A - B - C) | 8.447 | |||
| Total | 58.976 | 8.447 | ||||
| Undistributable portion | 50.528 | |||||
| Residual distributable portion | 8.447 |
1.1 Breakdown of item 10 "Interest and similar income"
| Debts instruments | Financing | Other | 2016 | 2015 | |
|---|---|---|---|---|---|
| 1. Financial assets held for trading | - | - | - | - | - |
| 2. Financial assets at fair value through profit or loss | - | - | - | - | - |
| 3. Available-for-sale financial assets | - | - | - | - | - |
| 4. Held-to-maturity investments | - | - | - | - | - |
| 5. Loans and receivables | - | - | - | 4.962 | 5.132 |
| 5.1 - With banks | - | - | 235 | 235 | 489 |
| 5.2 - With financial institutions | - | - | - | - | - |
| 5.3 - With customers | - | 4.337 | 391 | 4.727 | 4.643 |
| 6. Other assets | X | X | - | - | |
| 7. Hedging derivativesa | X | X | - | - | |
| Total | 4.962 | 5.132 |
Figures in '000
Interest income is broken down below with prior year corresponding figures:
| 2016 | 2015 | Change | ||
|---|---|---|---|---|
| Default interest | 3,427 | 3,470 | (43) | |
| Interest income - customers | 1,506 | 1,309 | 197 | |
| Interest income - banks | 235 | 489 | (254) | |
| Other interest income - debtors' compensation, etc. | 391 | 343 | 48 | |
| Total interest income | 5,558 | 5,611 | (52) | |
| Lump-sum prudent adjustments to default interest | (960) | (648) | (311) | |
| Interest income, net of adjustments | A | 4,599 | 4,962 | (363) |
| Realised gains | 1,785 | 1,331 | 455 | |
| IFRS adjustments for measuring loans and receivables at amortised cost |
(1,422) | (1,161) | (261) | |
| Total gains | B | 363 | 170 | 194 |
| Interest and similar income Figures in '000 |
A+B | 4,962 | 5,132 | (170) |
| Financing | Securities | Other | 2016 | 2015 | |
|---|---|---|---|---|---|
| 1. Due to banks | 16 | X | - | 16 | - |
| 2. Due to financial institutions | 500 | X | - | 500 | 1.594 |
| 3. Due to customers | - | X | - | - | - |
| 4. Securities issued | X | - | - | - | - |
| 5. Financial liabilities held for trading | - | - | - | - | - |
| 6. Financial liabilities at fair value through profit or loss | - | - | - | - | - |
| 7. Other liabilities | X | X | - | - | - |
| 8. Hedging derivatives | X | X | - | - | - |
| Total | 500 | - | - | 516 | 1.594 |
Figures in '000
Interest expense refers to advance payments on loans and receivables previously obtained from Unicredit Factoring S.p.A. (fully repaid) and the interest accrued during the first half of 2016 on the subordinated loan granted (and fully repaid) by the former sole shareholder Stepstone FH .
2.1 Breakdown of item 30 "Fee and commission income"
| Detail | Total 2016 | Total 2015 |
|---|---|---|
| 1. finance leases | - | - |
| 2. factoring transactions | 929 | 1,205 |
| 3. consumer loans | - | - |
| 4. guarantees issued | - | - |
| 5. services for: | 8 | 33 |
| - funds managed on behalf of third parties | - | - |
| - foreign exchange transactions | - | - |
| - product distribution | - | - |
| - other | 8 | 33 |
| 6. collection and payment services | 375 | 37 |
| 7. securitisation servicing services | - | - |
| 8. other fee and commission income: | - | - |
| - other | - | - |
| Total | 1,312 | 1,275 |
| Impairment losses | Reversals of impairment losses | |||||
|---|---|---|---|---|---|---|
| individual | portfolio | individual | portfolio | 2016 | 2015 | |
| 1 - Loans and receivables with banks | ||||||
| - leases | - | - | - | - | - | - |
| - factoring | - | - | - | - | - | - |
| - other loans and receivables | - | - | - | - | - | - |
| 2 - Loans and receivables with financial institutions | ||||||
| Acquired impaired loans and receivables | ||||||
| - leases | - | - | - | - | - | - |
| - factoring | - | - | - | - | - | - |
| - other loans and receivables | - | - | - | - | - | - |
| Other loans and receivables | ||||||
| - leases | - | - | - | - | - | - |
| - factoring | - | - | - | - | - | - |
| - other loans and receivables | - | - | - | - | - | - |
| 3 - Loans and receivables with customers | - | 1.341 | 1.341 | 3.113 | ||
| Acquired impaired loans and receivables | ||||||
| - leases | - | - | - | - | - | - |
| - factoring | - | - | - | - | - | - |
| - consumer loans | - | - | - | - | - | - |
| - other loans and receivables | - | - | - | - | - | - |
| Other loans and receivables | ||||||
| - leases | - | - | - | - | - | - |
| - factoring | - | - | - | 1.341 | 1.341 | 3.113 |
| - consumer loans | - | - | - | - | - | - |
| - other loans and receivables | - | - | - | - | - | - |
| Total | - | - | - | 1.341 | 1.341 | 3.113 |
Figures in '000
The reversal of the impairment loss on the portfolio mainly refers to the collection of loans and receivables and default interest in excess of the recognised amount.
8.2 - "Net reversals of impairment losses/impairment losses on available-for-sale financial assets"
None.
8.3 - "Net reversals of impairment losses/impairment losses on held-to-maturity investments"
None.
8.4 - "Net reversals of impairment losses/impairment losses on other financial transactions"
None.
| Items/Sectors | Total 2016 | Total 2015 |
|---|---|---|
| 1) Employees | 1,232 | 1,447 |
| a) wages and salaries | 840 | 993 |
| b) social security charges | 274 | 313 |
| c) post-employment benefits | ||
| d) pension and similar costs | ||
| e) accrual for post-employment benefits | 75 | 68 |
| f) accrual for pension and similar provisions: | - | |
| - defined contribution | ||
| - defined benefits | ||
| g) payments to external supplementary pension funds: | - | |
| - defined contribution | - | |
| - defined benefits | - | |
| h) other personnel expense | 43 | 73 |
| 2) Other personnel | 0 | 25 |
| 3) Directors and statutory auditors | 477 | 524 |
| 4) Retired personnel | ||
| 5) Cost recoveries for personnel seconded to other companies | (49) | (24) |
| 6) Cost reimbursements for personnel seconded to the company | ||
| Total | 1,660 | 1,972 |
| Total 2016 | Total 2015 | |
|---|---|---|
| Managers | 0 | 2 |
| Junior managers | 5 | 7 |
| Other employees | 7 | 10 |
| Total | 12 | 19 |
Similarly to the previous reports, the Chief Executive Officer is not included in the workforce.
9.3 Breakdown of item 110.b "Other administrative expenses"
| Detail | Total 2016 | Total 2015 |
|---|---|---|
| 615 | 713 | |
| Legal, technical and professional consultancies | ||
| Office lease | 218 | 207 |
| Software maintenance fees | 309 | 275 |
| Other overheads | 114 | 178 |
| 80 | 82 | |
| Travel costs and expense reimbursement | ||
| Post, telephone and data transmission costs | 32 | 40 |
| Undeductible VAT | - | 141 |
| Maintenance, repairs and rentals | 9 | 62 |
| 11 | 14 | |
| Utilities | ||
| Total | 1,387 | 1,712 |
Figures in '000
Other administrative expenses also include the fees paid to the independent auditors and other companies of the PwC network as detailed below:
| PwC S.p.A. | PwC network | |||
|---|---|---|---|---|
| Service | Italy | Abroad | Italy | Abroad |
| Audit | 54 | |||
| Advisory services | 59 | |||
| Depreciation (a) | Impairment losses (b) | Reversals of impairment losses (c) |
Carrying amount (a + b + c) |
|
|---|---|---|---|---|
| 1. Assets - property and equipment | 13 - |
- | 13 | |
| 1. 1 owned | ||||
| a) land | - | - - |
- | |
| b) buildings | - | - - |
- | |
| c) furniture | 9 | - - |
9 | |
| d) operating assets | 4 | - - |
4 | |
| e) other | - | - - |
- | |
| 1. 2 under finance lease | - | |||
| a) land | - | - - |
- | |
| b) buildings | - | - - |
- | |
| c) furniture | - | - - |
- | |
| d) operating assets | - | - - |
- | |
| e) other | - | - - |
- | |
| 2. Investment property | - | - | - | - |
| a) other | - | - - |
- | |
| Total | 13 - |
- | 13 |
10.1 Breakdown of item 120 "Depreciation and net impairment losses on property and equipment"
Figures in '000
11.1 Breakdown of item 130 "Amortisation and net impairment losses on intangible assets"
| Amortisation (a) | Impairment losses (b) | Reversals of impairment losses (c) |
Carrying amount (a + b + c) |
|
|---|---|---|---|---|
| 1. Goodwill | - | - | - | - |
| 2. Other intangible assets | 17 | - | - | 17 |
| 2.1 Owned | 17 | - | - | 17 |
| 2.2 Under finance lease | - | - | - | - |
| 3. Assets related to finance leases | - | - | - | - |
| 4. Assets under operating lease | - | - | - | - |
| Total | 17 | - | - | 17 |
Figures in '000
13.1 Breakdown of item 150 "Net accruals to provisions for risks and charges"
| 2016 | 2015 | |
|---|---|---|
| Net accruals to the provision for risks and charges | 500 | - |
| Total | 500 | - |
It was prudently recognised to cover the unfavourable outcome of some disputed loans and receivables from assignors.
| Total 2016 | Total 2015 | ||
|---|---|---|---|
| 14.1 Other income | 55 | 48 | |
| 14.2. Other expense | (110) | (132) | |
| Total | (55) | (84) | |
Figures in '000
| Total 2016 | Total 2015 | |
|---|---|---|
| Prior year income | 12 | 17 |
| Revenue from services | ||
| Other income | 43 | 30 |
| Total | 55 | 48 |
Figures in '000
Prior year income refers to amounts collected following legal proceedings in excess of the recognised receivable and are included in the "from collection" item.
| Total 2016 | Total 2015 | |
|---|---|---|
| Prior year expense | (105) | (113) |
| Amortisation of leasehold improvements | (3) | (14) |
| Other expense | (1) | (5) |
| Total | (110) | (132) |
Figures in '000
Prior year expense refers mainly to the legal fees incurred to recover the receivables in portfolio not repaid by debtors.
17.1 Breakdown of item 190 "Income taxes on continuing operations"
| Component/Values | 2016 | 2015 |
|---|---|---|
| 1. Current taxes (-) |
(1,075) | (2,504) |
| 2. Changes in current taxes from previous years (+/-) |
||
| 3. Decrease in current taxes for the year |
||
| 3.bis Decrease in current taxes for the year due to loans and | ||
| receivables | ||
| assets as per Law no. 214/2011 | 0 | 0 |
| 4. Change in deferred tax assets (+/-) |
(31) | (1,735) |
| 5. Change in deferred tax liabilities (+/-) |
375 | 2,970 |
| Tax expense for the year | (731) | (1,270) |
Figures in '000
| 2016 | 2015 | |
|---|---|---|
| PRE-TAX PROFIT (LOSS) ON CONTINUING OPERATIONS | 3,466 | 4,072 |
| Theoretical tax rate | 33.22% | 33.22% |
| Theoretical taxes | (1,151) | (1,353) |
| 1. IRES rate adjustment | ||
| 2. IRAP rate adjustment | ||
| 3. Permanent differences | 420 | 405 |
| 4. Transfer of prior year deferred tax assets | (322) | |
| 5. Other differences | ||
| Income taxes recognised in the income statement (item 190) | (731) | (1,270) |
| Interest income | Fee and commission income | |||||||
|---|---|---|---|---|---|---|---|---|
| Banks | Financial institutions finanziari |
Customers | Banks | Financial institutions finanziari |
Customers | 2016 | 2015 | |
| 1. Finance lease | ||||||||
| - immovable assets | ||||||||
| - movable assets | ||||||||
| - operating assets | ||||||||
| - intangible assets | ||||||||
| 2. Factoring | - 235 | 4.727 | - | - | 1.311 | 6.273 | 6.407 | |
| - current accounts | 1.266 | 667 | 1.934 | 1.907 | ||||
| - future loans and receivables | 240 | 0 | 240 | 230 | ||||
| - loans and receivables factored without recourse | 2.831 | 596 | 3.427 | 3.410 | ||||
| - loans and receivables acquired at below the nominal amount | - | - | ||||||
| - other financing | 235 | 391 | 47 | 672 | 860 | |||
| 3. Consumer loans | ||||||||
| - personal loans | ||||||||
| - special-purpose loans | ||||||||
| - salary-backed loans | ||||||||
| 4.Pawn loans | ||||||||
| 5 Guarantees and commitments | ||||||||
| - commercial | ||||||||
| - financial | ||||||||
| Total | - 235 | 4.727 | - | - | 1.311 | 6.273 | 6.407 |
| 2016 | 2015 | |||||||
|---|---|---|---|---|---|---|---|---|
| Gross | Impairment | Carrying | Gross | Impairment | Carrying | |||
| amount | losses | amount | amount | losses | amount | |||
| 1. Unimpaired assets | 68.938 | 3.718 | 65.221 | 79.023 | 4.469 | 74.554 | ||
| - Exposures to assignors (with recourse) | 8.635 | - | 8.635 | 11.706 | - | 11.706 | ||
| - Assignment of future receivables | 2.558 | - | 2.558 | 2.755 | - | 2.755 | ||
| - Other | 6.077 | - | 6.077 | 8.951 | - | 8.951 | ||
| - Exposures to assigned debtors (without | 60.304 | 3.718 | 56.586 | 67.317 | 4.469 | 62.848 | ||
| recourse) | ||||||||
| 2. Impaired assets | 4.004 | 210 | 3.794 | 2.324 | 250 | 2.074 | ||
| 2.1 Non-performing | - | - | - | - | - | - | ||
| - Exposures to assignors (with recourse) | - | - | - | - | - | - | ||
| - Assignment of future receivables | ||||||||
| - Other | ||||||||
| - Exposures to assigned debtors (without | - | - | - | - | - | - | ||
| recourse) | ||||||||
| - Loans and receivables acquired at below | ||||||||
| the nominal amount - Other |
||||||||
| 2.2 Unlikely to pay | 440 | 210 | 231 | 445 | 250 | 195 | ||
| - Exposures to assignors (with recourse) | - | - | - | - | - | - | ||
| - Assignment of future receivables | ||||||||
| - Other | ||||||||
| - Exposures to assigned debtors (without | 440 | 210 | 231 | 445 | 250 | 195 | ||
| recourse) | ||||||||
| - Loans and receivables acquired at below | ||||||||
| the nominal amount | ||||||||
| - Other | 440 | 210 | 231 | 445 | 250 | 195 | ||
| 2.3 Past due/overdue | 3.564 | - | 3.564 | 1.880 | - | 1.880 | ||
| - Exposures to assignors (with recourse) | 3.564 | - | 3.564 | 1.880 | - | 1.880 | ||
| - Assignment of future receivables | ||||||||
| - Other | 3.564 | - | 3.564 | 1.880 | - | 1.880 | ||
| - Exposures to assigned debtors (without | - | - | - | - | - | - | ||
| recourse) | ||||||||
| - Loans and receivables acquired at below | ||||||||
| the nominal amount | ||||||||
| - Other | ||||||||
| TO TAL | 72.942 | 3.927 | 69.015 | 81.347 | 4.719 | 76.628 |
| Advances | Outstanding | ||||||
|---|---|---|---|---|---|---|---|
| Time frames | Total 2016 | Total 2015 | Total 2016 | Total 2015 | |||
| - on demand | 8,112 | 6,127 | 11,646 | 9,396 | |||
| - up to 3 months | 1,014 | 1,656 | 1,455 | 2,539 | |||
| - from 3 to 6 months | 2,406 | 5,744 | 3,454 | 8,809 | |||
| - from 6 months to 1 year | |||||||
| - over 1 year | |||||||
| - open term | |||||||
| Total | 11,532 | 13,527 | 16,555 | 20,744 |
Figures in '000
| Exposures | ||||||
|---|---|---|---|---|---|---|
| Time frames | Total 2016 | Total 2015 | ||||
| - on demand | 897 | 253 | ||||
| - up to 3 months | 2,243 | 96 | ||||
| - from 3 to 6 months | 13,219 | 18,389 | ||||
| - from 6 months to 1 year | 23,649 | 24,647 | ||||
| - over 1 year | 17,476 | 19,717 | ||||
| - open term | ||||||
| Total | 57,484 | 63,101 |
| O pening impairme nt losses | Increase s | Decreases | Closing | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Impairment losse s |
Losses on sales |
Transfe rs from othe r cate gorie s |
Other increases |
Re ve rsals of impairment losse s |
Gains on assignme nt |
Transfe rs to other cate gories |
Derecognition | O ther decre ases |
impairment losses |
||
| Individual impairme nt losses on impaired assets | |||||||||||
| Exposures to assignors | 5 250 | - | 45 | - | 210 | ||||||
| - Non-performing | - | - | - | ||||||||
| - Unlikely to pay | 5 250 | 45 | - | 210 | |||||||
| - Past due/overdue | |||||||||||
| Exposures to assigned debtors | |||||||||||
| - Non-performing | |||||||||||
| - Unlikely to pay | |||||||||||
| - Past due/overdue | |||||||||||
| 2. Collective impairment losses on othe r asse ts | 960 4.469 | - | 1.341 | 9 - | 3.718 | ||||||
| - Exposures to assignors | |||||||||||
| - Exposures to assigned debtors | 960 4.469 | 1.341 | 9 | 361 | 3.718 | ||||||
| Total | 965 4.719 | 1.341 | 54 - | 361 | 3.927 |
Figures in '000
Net impairment losses refer to default interest receivable accrued at the reporting date (Euro 3.3 million).
| Item | Total 2016 | Total 2015 |
|---|---|---|
| 1. Without recourse | 11,353 | 11,230 |
| - including: acquired at below nominal amount | ||
| 2. With recourse | 26,069 | 32,715 |
| Total | 37,422 | 43,945 |
Figures in '000
| Item | Total 2016 | Total 2015 |
|---|---|---|
| Loans and receivables collected during the year |
0 | 3,984 |
| Loans and receivables at the reporting date | 0 | 0 |
| Item | Total 2016 | Total 2015 |
|---|---|---|
| Contracts to purchase future loans and receivables |
0 | 5,353 |
| Loans and receivables at the reporting date | 4,089 | 5,353 |
D.1 Value of guarantees given and commitments
None.
None.
The company attaches great importance to risk management and control in order to identify, assess and measure the events which may jeopardise its objectives.
The main current and potential risks identified based on the characteristics of the business and actively managed by the company are as follows:
The company specialises in the purchasing of loans and receivables "without recourse" and "with recourse" (the latter business line was launched in 2012), specifically from the public administration.
Its business activities are regulated by Law no. 52 of 21 February 1991 with respect to commercial loans and receivables, while all other loans and receivables are governed by article 1260 and following articles of the Italian Civil Code. Its customers mainly comprise companies of any size that provide goods, works or services to the public administration.
The terms and conditions of factoring contracts agreed from time to time with the assignor are defined based on the results of the credit and legal due diligences carried out on the assigning companies and the related assigned debtors, as well as the preliminary analysis of the loans and receivables to be factored in order to check their certainty, liquidity and collectability. These assumptions are necessary to obtain the issue of a court order in the event of non-payment at maturity.
Following the assignment of loans and receivables carried out pursuant to Law no. 52/1991 or article 1260 of the Italian Civil Code, the company succeeds the assignor in its relationship with the related assigned debtors. With respect to without-recourse transactions, following the full transfer of the nonrecourse risk vis-à-vis the assignor (except for returns for just cause), the company may recover the receivable only by taking legal action against the assigned debtor. The recovery of a receivable through a legal action against the assigned debtor requires the issue of a court order. The procedural status of the position is subsequently monitored together with the calculation of the estimated collection days.
With respect to with-recourse transactions, the company, which has the right to exercise the recourse action vis-à-vis the assignor, does not commence a recovery action against the debtor at the maturity date of the advance, unless the assignor does not repay the advance or expressly requests for it.
The credit (or counterparty) risk is the company's exposure to potential losses generated by the counterparty's failure to meet its obligations.
This risk is related to deficiencies associated with the nature of the loans and receivables purchased and the financial standing of the assignor (with recourse) or the assigned party (without recourse).
When loans and receivables are purchased without recourse, the primary counterparty risk is the assigned debtor. When the public administration (PA) is involved, the risk is vis-à-vis the public body or the local body, the local health care units (AA.SS.LL.) and hospitals (A.O.). The AA.SS.LL. and the A.O. are legally independent, but are financially supported by the central government through annual budget appropriations for the national health service and the regions.
With respect to with-recourse transactions (in the event of non-payment by the assigned debtor or return of the receivable when, during the judicial collection of the receivable, the inability to proceed against the debtor is confirmed), the company exercises its right of recourse against the assignor to obtain the return of the advances made. Consequently, the exposure to this risk refers to the assignor, instead of the assigned debtor.
The "quantifiable" risk is measured using the standardised method set out in the Supervisory regulations.
The credit risk may also include:
These risks are monitored during the preliminary investigation stage through careful and in-depth analysis of the credit standing of the parties involved.
Because of the lack of significant historical internal figures and the small number of assignors and debtors, the company is unable to develop risk measurement systems internally. Therefore, it adopts the standardised method set out in Circular no. 216 of 5 August 1996 - seventh update of 9 July 2007.
Under this method, exposures are broken down into segments, based on the nature of the counterparty and the technical characteristics of the relationship (with or without recourse) to which different weighting rates are applied. The latter may also consider the evaluations provided third parties (ECAI) acknowledged by the Bank of Italy (specifically, for public administration bodies).
With respect to IFRS-compliant factoring without recourse, exposures are allocated to "assigned debtors", while those with recourse are allocated to the "assignor", the beneficiary of the advance.
Consequently, the company carefully selects the "assignors" with which it signs assignment contracts through an accurate analysis of their credit standing, while considering the "public-sector" nature of the assigned debtors and the commercial development targets.
Selection takes place through:
Furthermore, the credit risk is constantly measured and monitored by the Risk control function through:
Credit risk assumption rests with the Chief Executive Officer for amounts below Euro 500,000 and the Executive committee (comprising the Managing director and the Chairman) for higher amounts. Responsibility for related party transactions rests with the Board of directors.
As part of the process to purchase loans and receivables, in addition to the decision-making activities carried out by the Chief Executive Officer or the Executive committee, the "credit committee", comprised of the Preliminary investigation manager, the Risk control function manager, the Legal function manager, the Administrative manager and the Portfolio manager, issues "non-binding" opinions and prepares specific reports which include all information deemed useful and necessary to carefully analyse the counterparty to be assigned and the loans and receivables which may be purchased, indicating the price to be applied and the expected economic returns.
The company does not apply risk mitigation techniques as defined in the Bank of Italy's circular no. 216, Section IV.
However, credit risk is mitigated through (i) the methods underlying the price to purchase the loans and receivables without recourse which provide for several tranches (the first upon purchase, the other ones when specific conditions, including the certification of the loan/receivable or the collection of the entire loan/receivable, are met); (ii) the pledging as a guarantee of the subsequent tranches until full recovery of all the loans and receivables purchased from the same assignor (with recourse) and obtaining of personal guarantees (specifically for with recourse transactions) subject to the preliminary evaluation of the guarantor.
When loans and receivables are factored without recourse, the risk is vis-à-vis the assigned debtors, mainly comprised of public administration bodies. Based on Supervisory requirements, credit exposures to the PA may be classified as:
With respect to loans and receivables factored without recourse and subsequently returned to the assignor, the risk - being the Repurchase price calculated on the basis of the contractual terms and conditions – is allocated to the assignor. In accordance with the Supervisory regulations, these loans and receivables are classified as:
The above classification is in line with the Supervisory requirement (Circular no. 217, 13th update) as of 1 January 2015 in respect of a different definition of "default" which entailed the reclassification of impaired assets into: non-performing, unlikely to pay (replacing the watchlist loan category) and impaired past due-overdue. The restructured exposure category is no longer present, while the new "non-performing forbearance exposure" and the "performing forbearance exposure" categories were introduced.
When loans and receivables are returned to an assignor in relation to which there are second tranches of the purchase price of other loans and receivables, contractually withheld to guarantee the full collection of all loans and receivables purchased, the exposure is included under the "risk of revocation claim" when the guarantee covers the amount of the returned loan/receivable. Furthermore, when the second tranches are due, the exposure is decreased by the same amount.
Conversely, when the second tranches of the price are not enough, the personal guarantees and/or the collateral acquired as part of the contract are enforced to recover the repurchase price. Should there be no ancillary guarantees, a repayment plan of the repurchase price is usually defined based on the assignor's repayment ability.
Should it be impossible to reach an out-of-court repayment agreement, the position will be classified under the relevant category, in accordance with the Supervisory regulations referred to above, by the Risk control function, informing the Chief Executive Officer.
The exposures related to "with recourse" transactions are classified as impaired past due-overdue in accordance with the "debtor's approach" regulation.
1. Credit exposures by portfolio and credit quality
| Portfolio/Quality | Non performing |
Unlikely to pay |
Impaired past due/overdue |
Unimpaired past due/overdue |
Other unimpaired |
Total |
|---|---|---|---|---|---|---|
| 1. Available-for-sale financial assets | ||||||
| 2. Held-to-maturity investments | ||||||
| 3. Loans and receivables with banks | 14,361 | 14,361 | ||||
| 4. Loans and receivables with customers | 231 | 3,564 | 1,841 | 63,458 | 69,093 | |
| 5. Financial assets at fair value through profit or loss | ||||||
| 6. Financial assets held for sale | ||||||
| Total 2016 | 0 | 231 | 3,564 | 1,841 | 77,819 | 83,454 |
| Total 2015 | 0 | 195 | 1,880 | 1,791 | 101,715 | 105,581 |
Figures in '000
Loans and receivables with banks show the company's current account balances.
2.1- Loans and receivables with customers: gross amounts, carrying amounts and residual maturity brackets
| Gross amount | Individual impairment |
Collective impairment |
Carrying amount |
||||||
|---|---|---|---|---|---|---|---|---|---|
| Impaired assets | |||||||||
| up to 3 months |
from 3 to 6 months |
from 6 months to 1 year |
more than 1 year |
Unimpaired assets |
|||||
| A. ON-STATEMENT FINANCIAL POSITION | |||||||||
| a) Non-performing | x | x | |||||||
| of which: forborne exposures | x | x | |||||||
| b) Unlikely to pay | 440 | x | 210 | x | 231 | ||||
| of which: forborne exposures | x | x | |||||||
| c) Impaired past due/overdue exposures | 3.564 | x | x | 3.564 | |||||
| of which: forborne exposures | 2.811 | x | x | ||||||
| d) Unimpaired past due/overdue exposures | x | x | x | x | 1.841 | x | 1.841 | ||
| of which: forborne exposures | x | x | x | x | x | ||||
| e) Other unimpaired exposures | x | x | x | x | 67.176 | x | 3.718 | 63.459 | |
| of which: forborne exposures | x | x | x | x | x | x | |||
| TO TAL A | 440 | 3.564 | 0 | 0 | 69.018 | 210 | 3.718 | 69.094 | |
| B. OFF-STATEMENT FINANCIAL POSITION | |||||||||
| a) Impaired | x | x | |||||||
| b) Unimpaired | x | x | x | x | x | ||||
| TO TAL B | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| TO TAL A + B | 440 | 3.564 | 0 | 0 | 69.018 | 210 | 3.718 | 69.094 |
Figures in '000
2.2- Loans and receivables with banks and financial institutions: gross amounts, carrying amounts and residual maturity bracket
| Gross amount | Individual impairment |
Collective impairment |
Carrying amount |
|||||
|---|---|---|---|---|---|---|---|---|
| Impaired assets deteriorate | ||||||||
| up to 3 months | from 3 to 6 months |
from 6 months to 1 year |
more than 1 year |
Unimpaired assets | ||||
| A. ON-STATEMENT FINANCIAL POSITION | ||||||||
| a) Non-performing | x | x | ||||||
| of which: forborne exposures | x | x | ||||||
| b) Unlikely to pay | x | x | ||||||
| of which: forborne exposures | x | x | ||||||
| c) Impaired past due/overdue exposures | x | x | ||||||
| of which: forborne exposures | x | x | ||||||
| d) Unimpaired past due/overdue exposures | x | x | x | x | x | |||
| of which: forborne exposures | x | x | x | x | x | |||
| e) Other unimpaired exposures | x | x | x | x | 14.361 | x | 14.361 | |
| of which: forborne exposures | x | x | x | x | x | |||
| TOTAL A | 0 | 0 | 0 | 0 | 14.361 | 0 | 0 | 14.361 |
| B. OFF-STATEMENT FINANCIAL POSITION | ||||||||
| a) Impaired | x | x | ||||||
| b) Unimpaired | x | x | x | x | x | |||
| TOTAL B | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| TOTAL A + B | 0 | 0 | 0 | 0 | 14.361 | 0 | 0 | 14.361 |
Figures in '000
These are the company's current account balances.
2.3- Classification of exposures based on external and internal ratings
2.3.1 Breakdown of credit exposure on- and off-statement of financial position by external rating class
| Class | Class | Class | Class | Class | Class | Unrated | Total | |
|---|---|---|---|---|---|---|---|---|
| 1 | 2 | 3 | 4 | 5 | 6 | |||
| A. On-statement of financial position | 56.586 | 12.507 | 69.093 | |||||
| B. Derivatives | ||||||||
| B.1 Financial derivatives | ||||||||
| B.2 Credit derivatives | ||||||||
| C. Guarantees given | ||||||||
| D. Commitments to disburse funds | ||||||||
| E. O ther | ||||||||
| Total | - | - | 56.586 | - | - | - | 12.507 | 69.093 |
Figures in '000
The Baa2 rating (class 3) assigned to the sovereign risk by the external rating agency Moody's leads to a weighting rate of 100% of exposures to public administration bodies, except for local bodies (20%) and central administrations (0%). The weighting rate of exposures with no ratings is 100%.
2.3.2 Breakdown of credit exposure on- and off-statement of financial position by internal rating class
None.
| in thousands of Euros | Values at 31 December 2016 |
Values at 31 December 2015 |
||
|---|---|---|---|---|
| BODIES PROVIDING HEALTH SERVICES | € | 38,728 | € | 43,515 |
| MANUFACTURING COMPANIES | € | 12,181 | € | 13,724 |
| OTHER BODIES PROVIDING HEALTH SERVICES | € | 9,817 | € | 11,584 |
| REGIONAL ADMINISTRATIONS | € | 7,071 | € | 7,518 |
| MUNICIPALITIES AND GROUPS OF MUNICIPALITIES | € | 665 | € | - |
| UNITS OR COMPANIES WITH 20 OR MORE EMPLOYEES |
€ | 184 | € | 202 |
| COMPANIES CONTROLLED BY LOCAL ADMNISTRATIONS |
€ | 138 | € | 137 |
| COMPANIES WITH FEWER THAN 20 EMPLOYEES | € | 131 | € | 42 |
| OTHER LOCAL ADMNISTRATIONS | € | 86 | ||
| GOVERNMENT ORGANISATIONS AND BODIES | € | 86 | € | 89 |
| BODIES PROVIDING ECONOMIC SERVICES | € | 5 | € | 5 |
| BODIES PROVIDING CULTURAL AND ASSISTANCE SERVICES |
€ | 1 | € | 1 |
| Total | € | 69,093 | € | 76,815 |
| in thousands of Euros | Values at 31 December 2016 |
Values at 31 December 2015 |
||
|---|---|---|---|---|
| CALABRIA | € | 36,299 | € | 41,462 |
| CAMPANIA | € | 23,240 | € | 23,301 |
| LAZIO | € | 6,823 | € | 8,608 |
| VENETO | € | 2,600 | € | 2,808 |
| PUGLIA | € | 111 | € | 193 |
| ABRUZZO | € | 5 | € | 5 |
| MOLISE | € | 4 | € | 342 |
| MARCHE | € | 4 | -€ | 49 |
| LOMBARDY | € | 3 | € | 3 |
| PIEDMONT | € | 3 | € | 3 |
| SARDINIA | € | - | € | 137 |
| EMILIA-ROMAGNA | € | - | € | 2 |
| Total | € | 69,093 | € | 76,815 |
Large exposures are positions equal to or greater than 10% of the regulatory capital.
At 31 December 2016, only two positions exceeded 10% of the regulatory capital, as shown below:
| Debtor | Carrying amount | Weighted amount |
|---|---|---|
| ASL NAPOLI 3SUD | 9,602,782 | 9,602,782 |
| A.S. PROV.LE OF CROTONE | 8,863,855 | 8,863,855 |
No risk position exceeds 25% of the regulatory capital. Consequently, no additional requirement envisaged by regulation when exceeding the threshold is necessary.
4 Models and other methodologies to measure and manage credit risk
None.
Performing exposures to the assignor for with-recourse advances and returned loans and receivables have a weighting rate of 100%.
The company is not exposed to the market risk as its portfolio does not include financial instruments.
The company is exposed to the interest rate risk only to the extent of its non-current portfolio, while it is not exposed to this risk (included in the market risk) as it does not have a significant trading book. With respect to liabilities, the company is no longer exposed to banks and the amounts due to customers in relation to the payment of the second tranches of the consideration for the loans and receivables purchased without recourse do not bear any interest. The interest rate risk determines the potential impact that an unexpected change in interest rates may have on the company's current profit and equity due to the mismatching between lending and funding.
Loans bear a fixed rate, considering as such also the rate applicable to default interest pursuant to Legislative decree no. 231 on past due/overdue loans and receivables purchased without recourse (8% + ECB rate which is substantially close to zero).
The company measures this risk in accordance with the methodology described in annex C, Title III, Chapter 1 of the Annex to Circular no. 263.
| On demand | Up to 3 months | From 3 to 6 months | From 6 months to 1 year |
From 1 to 5 years | From 5 to 10 years |
After 10 years |
Open term | |
|---|---|---|---|---|---|---|---|---|
| 1. Assets | 15.469.329 | 2.261.577 | 13.306.697 | 35.336.658 | 17.615.327 | 0 | 0 | 0 |
| 1.1 Debt instruments | ||||||||
| 1.2 Loans and receivables | 15.469.329 | 2.261.577 | 13.306.697 | 35.336.658 | 17.615.327 | 0 | ||
| 1.3 Other instruments | ||||||||
| 2. Liabilities | (1.638.690) | (1.411.312) | (4.779.137) | (7.842.528) | (3.903.429) | 0 | 0 | 0 |
| 2.1 Amounts due | (1.638.690) | (1.411.312) | (4.779.137) | (7.842.528) | (3.903.429) | |||
| 2.2 Securities issued | ||||||||
| 2.3 Other liabilities | ||||||||
| 3. Financial derivatives | ||||||||
| Options | ||||||||
| 3.1 Long positions | ||||||||
| 3.2 Short positions | ||||||||
| Other derivatives | ||||||||
| 3.3 Long positions | ||||||||
| 3.4 Short positions |
Figures in '000
The company's portfolio is mainly comprised of past due/overdue loans and receivables from the public administration whose residual life is related to the expected collection days.
The estimated term also considers the debtor's geographical segment, the progress of the recovery of the loan/receivable through legal action and the existence of any ban on seize. The estimate does not include the payments made voluntarily by the debtors given the little significance of this event and the short historical series supporting quantitative estimates.
There are no financial liabilities bearing floating rates.
The interest rate risk on the non-current portfolio is a "quantifiable" risk in relation to which the company applies the methodology described in Annex M to the Bank of Italy's Circular no. 216 as part of Pillar II risk quantification.
None.
The company is not exposed to price risk, which is included in the market risk, as it has no instruments generating this risk.
1. General aspects
Not significant.
1. Models and other methodologies to measure and manage the price risk
Not significant.
2. Other quantitative disclosure about the price risk
Not significant.
The company has no foreign currency assets or liabilities. Consequently, it is not exposed to the currency risk.
Operational risks refer to the losses or damage suffered by company or third parties as a result of the inadequacy or malfunctioning of procedures, systems and human resources or from external events.
In order to identify and monitor the operational risks typical of its activities, the company has identified the operational risks, if any, existing within its processes, setting up and implementing the controls necessary to mitigate them. The risk of losses or damage that may arise from the sudden unavailability of one or more technical applications and/or infrastructures (hardware and software), due to material damage, is mitigated through prevention and control activities, including data back-up, review, maintenance and disaster recovery plans.
Finally, the evolution of the relevant regulatory and legislative background is another potential source of risk. In this respect, the company monitors its internal procedures and policies to ensure compliance with the regulations applicable from time to time, in order to implement any changes and minimise any financial impact.
| Operational risk | 2014 | 2015 | 2016 | Three-year average |
Capital requirement 2016 |
|---|---|---|---|---|---|
| Total income | 6,662 | 4,813 | 5,758 | 5,744 | 862 |
The funding liquidity risk, related to the company's current or future inability to meet its financial commitments, is the main source of risk. The exposure to this risk is mitigated by:
The company is not exposed to the market liquidity risk as it has no trading books.
Under its lending and funding structure, the company has no significant misalignments between the maturity dates of collections and payments.
With respect to transactions without recourse, payment of the first tranche of the consideration to the assignor is financed by the cash and cash equivalents available on bank current accounts.
Payment of the second tranche to the assignor (and repayment of the advance to the lending body) is subject to the full collection of the related loan/receivable.
With respect to factoring with recourse, the advance to the disbursed to the assignor (up to 80% of the transferred loan/receivable) is drawn from the cash and cash equivalents available on bank current accounts. When the transferred loan/receivable is collected, the company decreases the advance granted to the assignor and, should the collected amount be greater than the exposure, it will pay the excess amount to the assignor.
The regular flow of collections and deposits on bank current accounts prevents the liquidity risk.
Therefore, the liquidity risk is subject to the following factors:
In order to minimise the above risk, the company:
Under its lending and funding structure, the company has no significant misalignments between the maturity dates of collections and payments.
The recourse to sources of financing has always considered the sustainability of costs and the company's ability to repay.
To date, the company is not indebted to banks. The funding structure changed as follows over the past three years:
| Sources of financing | 2013 | 2014 | 2015 | 2016 |
|---|---|---|---|---|
| Banks and financial intermediaries | € 56,863,670 | € 6,091,141 | € - |
€ - |
| Subordinated loan from the former | ||||
| sole shareholder | € 13,744,658 | € 14,944,658 | € 16,144,658 | € - |
| Loan from the former sole | ||||
| shareholder | € 16,333,476 | € 17,326,580 | € - |
€ - |
| II tranches – assignors | € 48,899,408 | € 35,882,780 | € 23,198,305 | € 19,575,096 |
In order to monitor the liquidity risk, the Administration department produces a monthly report which shows available cash and the projected outflows of the month (advances/balance to be disbursed to assignors, current expenses, e.g., salaries, payment of interest expense, etc.). Together with the Risk control function, it checks that the projection balance is not below Euro 500,000 (the significant threshold that ensures that the company's will continue as a going concern for at least two months) and provides the Chief Executive Officer with adequate information. To date, the company has always complied with this threshold.
| From | From | From | From | From | From | From | From | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 1 | 7 | 15 days | 1 | 3 | 6 | 1 | 3 | After | Open term |
||
| On demand | to | to | to | month | months | months | to | years | 5 years | ||
| 7 | 15 | 1 | to 3 | to 6 | to 1 | 3 | to 5 | ||||
| On-statement of financial position assets | 15.469 | days | days | month 8.328 |
months 2.876 |
months 12.143 |
year 17.461 |
years 16.898 |
years 0 |
||
| A.1 Government bonds | |||||||||||
| A.2 Other debt instruments | |||||||||||
| A.3 Financing | 1.107 | 0 | 8.328 | 2.876 | 12.143 | 17.461 | 16.898 | ||||
| A.4 Other assets | 14.362 | 0 | 0 | 0 | |||||||
| On-statement of financial position liabilities | (1.639) | (1.152) | (267) | (4.911) | (8.221) | (4.621) | 0 | ||||
| B.1 Due to: | |||||||||||
| - Banks | |||||||||||
| - Financial institutions | |||||||||||
| - Customers | (1.639) | (1.152) | (267) | (4.911) | (8.221) | (4.621) | 0 | ||||
| B.2 Debt instruments | |||||||||||
| B.3 Other liabilities | |||||||||||
| Off-statement of financial position transactions | |||||||||||
| C.1 Financial derivatives with | |||||||||||
| exchange of principal | |||||||||||
| - Long positions | |||||||||||
| - Short positions | |||||||||||
| C.2 Derivatives withouth | |||||||||||
| exchange of principal | |||||||||||
| - Positive differentials | |||||||||||
| - Negative differentials | |||||||||||
| C.3 Financing to be received | |||||||||||
| - Long positions | |||||||||||
| - Short positions | |||||||||||
| C.4 Irrevocable commitments to | |||||||||||
| disburse funds | |||||||||||
| - Long positions | |||||||||||
| - Short positions | |||||||||||
| C.5 Financial guarantees | |||||||||||
| issued | |||||||||||
| C.6. Financial guarantees received |
The company's portfolio is mainly comprised of past due/overdue loans and receivables from the public administration whose residual life is related to the expected collection days.
The estimated term also considers the debtor's geographical segment, the progress of the recovery of the receivable through legal action and the existence of any ban on seize. The payments made voluntarily by the debtors were excluded given the little significance of this event and the short historical series supporting quantitative estimates.
The company's definition of Regulatory capital is consistent with that set out in the Bank of Italy's circular no. 216, Section II.
The company must comply with the capital requirements on an individual basis as it belongs to a group whose parent is based in Europe. As it does not collect savings from the general public, in accordance with the applicable legislation, it applies 6% to the risk-weighted positions, maintaining a capital requirement for credit risk far above the regulatory threshold.
4.1.2.1 Company's equity: breakdown
| Items/Values | 2016 | 2015 |
|---|---|---|
| 1. Share capital | 47,000 | 47,000 |
| 2. Share premium | ||
| 3. Reserves | 12,069 | 11,929 |
| - income-related | ||
| a) legal reserve |
3,612 | 3,471 |
| b) statutory |
10 | 10 |
| c) treasury shares | ||
| d) other | 8,447 | 8,447 |
| - other | ||
| 4. (Treasury shares) | ||
| 5. Valuation reserves | -93 | -46 |
| - Available-for-sale financial assets | ||
| - Property and equipment | ||
| - Intangible assets | ||
| - Hedges of investments in foreign operations | ||
| - Cash flow hedges | ||
| - Exchange rate gains/(losses) | ||
| - Non-current assets held for sale and disposal groups | ||
| - Net actuarial losses on defined benefit plans | -93 | -46 |
| - Portion of valuation reserves of equity-accounted investments |
||
| 6. Equity instruments | ||
| 7. Profit (loss) for the year | 2,735 | 2,802 |
| Total | 61,711 | 61,684 |
Figures in '000
4.1.2.2 Valuation reserves for available-for-sale financial assets: breakdown
None.
4.1.2.3 Valuation reserves for available-for-sale financial assets: annual changes
None.
The company's regulatory capital is almost entirely comprised of the share capital, reserves and the profit for the year.
| Totale 2016 | Totale 2015 | |
|---|---|---|
| A. Tier 1 capital (Common Equity Tier 1 – CET1) before the application of prudential filters |
61.711 | 59.022 |
| of which CET1 instruments subject to transitional provisions | ||
| B. CET1 prudential filters (+/-) | ||
| C. CET1 before deductions and the effect of transitional provisions (A +/- B) | 61.711 | 59.022 |
| D. Deductions from CET1 | -14 | -24 |
| E. Transitional provisions – Impact on CET1 (+/-) | ||
| F. Total Tier 1 capital (Common Equity Tier 1 – CET1) (C – D +/-E) | 61.697 | 58.998 |
| G. Additional Tier 1 – AT1) before deductions and the effect of transitional provisions |
||
| of which AT1 instruments subject to transitional provisions | ||
| H. Deductions from AT1 | ||
| I. Transitional provisions – Impact on AT1 (+/-) | ||
| L. Total Additional Tier 1 – AT1 (G - H +/- I) | 61.697 | 58.998 |
| M. Tier 2 –T2 before deductions and the effect of transitional provisions | 0 | 16.145 |
| of which T2 instruments subject to transitional provisions | ||
| N. Deductions from T2 | ||
| O. Transitional provisions – Impact on T2 (+/-) | 0 | |
| P. Total Tier 2 –T2 (M - N) | 16.145 | |
| Q. Regulatory capital (F + L + P) | 61.697 | 75.143 |
Figures in '000
Tier 1 capital of 2015 (A) is shown net of the dividend paid in 2016.
The company calculates the Total internal capital in accordance with applicable regulations and the principle of proportionality, applying the Building block approach, whereby the regulatory requirements for Pillar 1 risks are added up to internal capital, if any, related to the other significant Pillar 2 measurable risks.
The calculation of the total internal capital considers and quantifies the following risks:
The equity components used to cover the total internal capital are the same as those used to calculate regulatory capital. Consequently, the capital adequacy with respect to the risks to which the company is exposed is assessed by comparing the total internal capital against regulatory capital.
Until 31 December 2014, the company has disclosed information about its capital adequacy, risk exposure and the general characteristics of the systems used to identify, measure and manage these risks (Pillar III) on the website of the trade association (ASSIFACT). Starting from 1 January 2015, this information has been available on its website www.betastone.com.
Following the company's merger into Banca Sistema, the information about 2016 will be included in the disclosure provided by the parent, Banca Sistema, available on the website www.bancaistema.it.
| Unweighted amounts | Weighted amounts | |||
|---|---|---|---|---|
| 2016 | 2015 | 2016 | 2015 | |
| A. RISK ASSETS | ||||
| A.1 Credit and counterparty risk | ||||
| 1. Standardised methodology | 89.513 | 109.858 | 68.729 | 79.221 |
| 2. Internal rating-based methodology | ||||
| 2.1 Basic | ||||
| 2.2 Advanced | ||||
| 3. Securitisation | ||||
| B. REGULATORY CAPITAL REQUIREMENTS | ||||
| B.1 Credit and counterparty risk | 4.124 | 4.753 | ||
| B.2 Credit valuation adjustment risk | ||||
| B.3 Settlement risk | ||||
| B.4 Market risk | ||||
| 1. Standard methodology | ||||
| 2. Internal models | ||||
| 3. Concentration risk | ||||
| B.5 Operational risk | 862 | 991 | ||
| 1. Basic | 862 | 991 | ||
| 2. Standardised | ||||
| 3. Advanced | ||||
| B.6 Other prudential requirements | ||||
| B.7 Other calculation elements | ||||
| B.8 Total prudential requirements | 4.985 | 5.744 | ||
| C. RISK ASSETS AND CAPITAL RATIOS | ||||
| C.1 Weighted risk assets | 83.089 | 95.736 | ||
| C.2 Tier 1 capital/Weighted risk assets (CET 1 capital ratio) | 74% | 62% | ||
| C.3 Tier 1 capital/Weighted risk assets (Tier 1 capital ratio) | 74% | 62% | ||
| C.4 Regulatory capital/Weighted risk assets (Total capital ratio) | 74% | 78% |
Figures in '000
Prudential reporting figures at 31 December 2016.
| Section 5 – Statement of comprehensive income | ||||
|---|---|---|---|---|
| -- | ----------------------------------------------- | -- | -- | -- |
| 2016 | 2015 | ||
|---|---|---|---|
| 10 | Profit for the year | 2.734.882 | 2.801.596 |
| Other comprehensive income/(expense), net of income tax, that will not be reclassified subsequently to profit | |||
| or loss | |||
| 20 | Property and equipment | ||
| 30 | Intangible assets | ||
| 40 | Defined benefit plans | (46.571) | 7.047 |
| 50 | Non-current assets held for sale | ||
| 60 | Portion of valuation reserves of equity-accounted investees | ||
| Other comprehensive income/(expense), net of income tax, that will be reclassified subsequently to profit or loss | |||
| 70 | Hedges of investments in foreign operations | ||
| 80 | Exchange rate gains/(losses) | ||
| 90 | Cash flow hedges | ||
| 100 | Available-for-sale financial assets | ||
| 110 | Non-current assets held for sale | ||
| 120 | Portion of valuation reserves of equity-accounted investees | ||
| 130 | Total other comprehensive income/(expense), net of income tax | (46.571) | 7.047 |
| 140 | Comprehensive income (items 10+130) | 2.688.311 | 2.808.643 |
Transactions with the parent
Share capital is wholly owned by Banca Sistema S.p.A. which, pursuant to article 2497 and following articles of the Italian Civil Code, manages and coordinated the Company.
The highlights of the parent's statement of financial position and income statement relating to the last approved individual financial statements for 2015 are given below:
| Assets | 31/12/2015 | 31/12/2014 | |
|---|---|---|---|
| 10. | Cash and cash equivalents | 104,251 | 66,274 |
| 20. | Financial assets held for trading | - | 62,800 |
| 40. | Available-for-sale financial assets | 925,401,846 | 858,007,084 |
| 60. | Loans and receivables with banks | 1,996,278 | 16,591,377 |
| 70. | Loans and receivables with customers | 1,459,255,000 | 1,194,759,295 |
| 100. | Equity investments | 2,377,570 | 2,377,420 |
| 110. | Property and equipment | 1,046,900 | 1,176,601 |
| 120. | Intangible assets | 1,871,896 | 1,904,214 |
| of which: goodwill | 1,785,760 | 1,785,760 | |
| 130. | Tax assets | 7,352,330 | 2,752,361 |
| a) current | 3,536,812 | 41,044 | |
| b) deferred | 3,815,518 | 2,711,317 | |
| of which: as per Law no. 214/2011 | 2,658,441 | 2,261,265 | |
| 150. | Other assets | 12,587,718 | 4,322,640 |
| Total assets | 2,411,993,789 | 2,082,020,066 |
| Liabilities and equity | 31/12/2015 | 31/12/2014 | |
|---|---|---|---|
| 10. | Due to banks | 362,075,254 | 821,403,761 |
| 20. | Due to customers | 1,878,338,848 | 1,153,796,527 |
| 30. | Securities issued | 20,102,319 | 20,109,447 |
| 80. | Tax liabilities | 804,176 | 6,248,024 |
| a) current | - | 6,233,877 | |
| b) deferred | 804,176 | 14,147 | |
| 100. | Other liabilities | 55,617,999 | 36,591,590 |
| 110. | Post-employment benefits | 1,303,389 | 1,173,344 |
| 120. | Provisions for risks and charges | 348,370 | 998,730 |
| b) other provisions | 348,370 | 998,730 | |
| 130. | Valuation reserves | 350,413 | 1,778 |
| 160. | Reserves | 26,929,739 | 9,526,896 |
| 170. | Share premium | 39,435,649 | 4,325,085 |
| 180. | Share capital | 9,650,526 | 8,450,526 |
| 200. | Profit (Loss) for the year (+/-) | 17,037,107 | 19,394,357 |
| Total liabilities and equity | 2,411,993,789 | 2,082,020,066 |
in Euros
| 2015 | 2014 | ||
|---|---|---|---|
| 10. | Interest and similar income | 79,258,219 | 75,842,919 |
| 20. | Interest and similar expense | (21,012,533) | (27,455,229) |
| 30. | Net interest income | 58,245,686 | 48,387,690 |
| 40. | Fee and commission income | 12,741,843 | 12,537,011 |
| 50. | Fee and commission expense | (1,571,431) | (1,066,587) |
| 60. | Net fee and commission income | 11,170,412 | 11,470,424 |
| 70. | Dividends and similar income | 32,850 | 33,070 |
| 80. | Net trading income | 151,958 | 885,611 |
| 100. | Gain on the sale or repurchase of: | 2,518,381 | 3,810,045 |
| b) available-for-sale financial assets | 2,518,381 | 3,809,959 | |
| d) financial liabilities | - | 86 | |
| 120. | Total income | 72,119,287 | 64,586,840 |
| 130. | Net impairment losses/reversals of impairment losses on: | (5,439,467) | (3,644,928) |
| a) loans and receivables | (5,439,467) | (3,644,928) | |
| 140. | Net financial income | 66,679,820 | 60,941,912 |
| 150. | Administrative expenses: | (41,803,993) | (30,484,566) |
|---|---|---|---|
| a) personnel expenses | (16,778,714) | (11,520,273) | |
| b) other administrative expenses | (25,025,279) | (18,964,293) | |
| 160. | Net accruals to provisions for risks and charges | 300,000 | (369,448) |
| 170. | Net impairment losses/reversals of impairment losses on property and equipment | (246,402) | (182,084) |
| 180. | Net impairment losses/reversals of impairment losses on intangible assets | (60,059) | (39,680) |
| 190. | Other operating income/expense | 72,293 | (338,465) |
| 200. | Operating costs | (41,738,161) | (31,414,243) |
| 210. | Net gains (losses) on equity investments | - | - |
| 250. | Pre-tax profit (Loss) on continuing operations | 24,941,659 | 29,527,669 |
| 260. | Income taxes on continuing operations | (7,904,552) | (10,133,312) |
| 290. | Profit (Loss) for the period | 17,037,107 | 19,394,357 |
in Euros
Related party transactions were carried out on an arm's length basis and exclusively referred to the current account held with the parent which, at 31 December 2016, had a credit balance of Euro 14,294,789. Furthermore, they comprise the commercial collaboration agreement signed on 16 September 2016 whereby the Company received fees of Euro 46,695 from Banca Sistema.
In the first half of 2016, the subordinated loan (nominal amount for supervisory purposes of Euro 10,000,000) was repaid to the former sole shareholder Stepstone FH - a related party until 1 July 2016, in addition to interest accrued on the signing date (of which Euro 499,726 pertaining to the year).
As set out in table 9.1 Part C of these notes, the Directors' fees amount to Euro 401 thousand. Together with those paid to the Board of statutory auditors (Euro 76 thousand), the fees total Euro 477 thousand.
* * *
ai sensi dell'art. 2429 comma 2 cod. civ.
***
Signori Azionisti di Banca Sistema S.p.A., che in virtù della operazione straordinaria di fusione intervenuta con effetto giuridico dal primo istante del 01 gennaio 2017 siete chiamati ad approvare il bilancio di Beta Stepstone S.p.A. ("Società"), incorporata in Banca Sistema S.p.A.,
la presente relazione è stata approvata collegialmente ed in tempo utile per il suo deposito presso la sede della società, nei 15 giorni precedenti la data di convocazione dell'assemblea di approvazione del bilancio.
Con deliberazione assunta nel corso dell'Assemblea ordinaria del 01 luglio 2016, a seguito delle dimissioni del precedente Collegio Sindacale, è stato nominato il nuovo Collegio Sindacale, nelle persone degli scriventi Dott. Diego De Francesco (Presidente), Dott. Fedele Gubitosi (Sindaco Effettivo, già Presidente di codesto organo di controllo) e Dott. Cesare Girello (Sindaco effettivo); prima della riunione del 15 dicembre 2016, quest'ultimo ha rassegnato le proprie dimissioni per ragioni strettamente personali, venendo per l'effetto sostituito dal Dott. Massimo Conigliaro, il quale era Sindaco Supplente.
Nel corso dell'esercizio 2016, in conformità alle disposizioni di legge e di Statuto, abbiamo vigilato sull'osservanza della legge, dei regolamenti e dello Statuto; nel rispetto dei principi di corretta amministrazione; sull'adeguatezza e funzionamento dell'assetto organizzativo nonché sull'adeguatezza e funzionamento dell'assetto amministrativo e contabile, così come sugli altri atti e fatti previsti dalla legge.
In particolare ribadiamo che la Società è ad oggi fusa per incorporazione in Banca Sistema S.p.A. e pertanto il soggetto giuridico Beta Stepstone S.p.A. è estinto; ciononostante, essendo la fusione efficace a partire dal primo istante dell'anno 2017, è stato necessario redigere e portare all'approvazione dell'assemblea degli azionisti (di Banca Sistema S.p.A.) il bilancio dell'esercizio chiuso al 31 dicembre 2016, ultimo giorno di esistenza dell'entità giuridica Beta Stepstone S.p.A.
Abbiamo esaminato il progetto di bilancio d'esercizio di Beta Stepstone S.p.A. al 31 dicembre 2016 (il "Bilancio"), composto dallo Stato Patrimoniale, dal Conto Economico, dal Prospetto della Redditività complessiva, dal Prospetto delle variazioni di Patrimonio Netto, dal Rendiconto Finanziario e dalla Nota Integrativa, corredato dalla Relazione sulla Gestione e dai prospetti informativi complementari, portante un utile di esercizio di € 2.734.882,00.
Il Consiglio di Amministrazione, ad esito dell'approvazione avvenuta in data 08 marzo 2017, ha messo a nostra disposizione il fascicolo nei termini di legge.
Nel corso del 2016 e fino alla data odierna il Collegio Sindacale pro tempore in carica ha effettuato 6 riunioni (inclusa quella relativa alla stesura della presente relazione), ed ha partecipato alle riunioni degli organi sociali.
Di tutte le attività descritte poc'anzi Vi diamo dettagliata informativa nel seguito della presente relazione.
Nel presente paragrafo vi riferiamo sull'attività svolta da questo Collegio Sindacale ai sensi dell'art. 2403 del codice civile.
Nel corso dell'esercizio il Collegio ha vigilato sull'osservanza della legge, dell'atto costitutivo e sul rispetto dei principi di corretta amministrazione. L'attività è stata ispirata ai principi di comportamento del Collegio Sindacale raccomandati dal Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili.
Oltre alle riunioni sindacali di cui si è scritto precedentemente, nel corso del 2016 il Collegio pro tempore in carica ha partecipato alle riunioni degli organi sociali, svoltesi nel rispetto delle norme statutarie, legislative e regolamentari che ne disciplinano il funzionamento e in virtù delle quali si può ragionevolmente assicurare che le deliberazioni adottate sono state conformi alla legge ed allo Statuto sociale, non sono state manifestamente imprudenti, azzardate o in potenziale conflitto d'interesse né in contrasto con quelle assunte dall'Assemblea degli Azionisti o tali che abbiano potuto compromettere l'integrità del patrimonio sociale.
Nello svolgimento delle proprie attività in seno alle riunioni sindacali, il Collegio si è riunito periodicamente con i responsabili delle principali funzioni interne della Società (compliance e antiriciclaggio, sistema di controllo interno e audit, finanza); ha esaminato i documenti forniti ed effettuato le proprie analisi e valutazioni, riepilogate nei propri verbali e che non hanno portato all'emersione di elementi in grado di far dubitare del rispetto della legge, dello Statuto sociale e dei principi di corretta amministrazione; ha analizzato le operazioni di maggior rilievo economico, finanziario e patrimoniale, giudicandole non azzardate e/o pregiudizievoli per l'andamento economico, patrimoniale e finanziario della Società.
Il Collegio Sindacale dà atto che nel corso delle riunioni consiliari e nel bilancio sono state esposte le principali informazioni inerenti i rapporti della Banca con parti correlate. Al riguardo, il Collegio Sindacale ritiene opportuno richiamare l'attenzione dei soci sulla lettura dei paragrafi della Relazione sulla Gestione e della Nota Integrativa in cui tali accadimenti sono descritti.
Fra i fatti di rilievo verificatisi nel 2016 segnaliamo:
In materia di "fatti di rilievo avvenuti nel corso dell'esercizio" si rinvia altresì al contenuto della relazione sulla gestione predisposta dagli amministratori.
Infine, ai sensi dell'art. 2408 del c.c. si dichiara che, nel corso del 2016, non è stata ricevuta alcuna denunzia da parte dei Soci, né esposti di altro tipo, né fatti censurabili o comunque negativamente rilevanti segnalati dalla Società di Revisione o da altri, tali da richiedere la segnalazione alla Banca d'Italia e/o menzione nella presente relazione.
Nella presente sezione diamo conto della nostra attività di controllo inerente la composizione e redazione del bilancio di esercizio di Beta Stepstone S.p.A. per il periodo chiuso al 31 dicembre 2016.
Il Bilancio è stato redatto secondo i Principi Contabili Internazionali (IAS/IFRS), omologati dalla Commissione Europea e recepiti in Italia dal Decreto Legislativo 28 febbraio 2005, n. 38 tenendo in considerazione le istruzioni della Banca d'Italia, emanate con Circolare n. 262 del 22 dicembre 2005 e ss.mm.ii.
In ottemperanza alle disposizioni del D.Lgs. 39/2010, spetta al soggetto incaricato del controllo legale dei conti esprimere un giudizio sul bilancio che indichi che è conforme alle norme che ne disciplinano la redazione e se rappresenta in modo veritiero e corretto la situazione patrimoniale e finanziaria, i flussi di cassa ed il risultato economico dell'esercizio; al riguardo si segnala che PricewaterHouseCoopers S.p.A. (di seguito "PWC") ha scambiato ai sensi dell'art. 2409-septies le informazioni rilevanti con il Collegio Sindacale ed ha rilasciato la propria relazione di revisione al bilancio al 31/12/2016 in data 20/03/2017, e tale relazione non contiene rilievi o eccezioni.
Pertanto il Collegio Sindacale assume che i dati del bilancio corrispondano a quelli risultanti dalla contabilità interna, tenuta regolarmente nel rispetto dei principi di cui alla normativa vigente.
Ciò posto, il Collegio Sindacale ha vigilato che il generale procedimento di composizione e redazione del bilancio fosse compliant alla normativa vigente.
Lo Stato Patrimoniale relativo al bilancio che viene sottoposto all'approvazione dell'Assemblea dei Soci si riassume nei seguenti valori (in migliaia di Euro):
| Attività……………………………………………………………………89.527.688 | |
|---|---|
| Passività…………………………………27.817.173 | |
| Capitale e riserve…………………………………………………………58.975.633 | |
| Risultato dell'esercizio………………………………………………………2.734.882 |
Il Conto Economico riclassificato presenta, in sintesi, i seguenti valori:
| Margine d'intermediazione…………………………………………………5.757.606 |
|---|
| Rettifiche/riprese di valore nette per deterioramento attività finanziarie…1.340.618 |
| Costi operativi (spese amministrative e altri proventi / oneri) ……………(3.101.766) |
| Rettifiche su attività materiali/immateriali…………………………………….(30.134) |
| Accantonamenti netti ai fondi per rischi e oneri……………………………(500.000) |
| Utile operatività corrente al lordo delle imposte……………………………3.466.324 | |
|---|---|
| Imposte sul reddito……………………………………………………………(731.442) | |
| Risultato dell'esercizio………………………………………………………2.734.882 |
Nel corso dell'esercizio è stato effettuato con i rappresentanti della società di revisione legale PWC lo scambio di informazioni rilevanti per l'espletamento dei rispettivi compiti.
Al riguardo, si segnala la partecipazione della Società di Revisione legale alla riunione di insediamento del rinnovato Collegio Sindacale, il 12 settembre 2016, nell'ambito della quale PWC non ha segnalato atti o fatti ritenuti censurabili, sulla base della revisione contabile svolta con data di riferimento 30 giugno, e ha rassicurato il Collegio sull'inesistenza di aspetti significativi che richiedessero segnalazione circa la regolare tenuta della contabilità e la corretta rilevazione dei fatti di gestione.
PWC ha attestato, in conformità all'art. 17 del D.Lgs. 39/2010, che nel periodo compreso tra il 01 gennaio ed il 31 dicembre 2016 non sono state riscontrate situazioni che abbiano compromesso l'indipendenza della società di revisione o cause di incompatibilità ai sensi degli art. 10 e 17 del D.Lgs. 39/2010 e relative disposizioni attuative.
Altresì, PWC ha informato il Collegio Sindacale che dalla revisione legale svolta al 31 dicembre 2016 non sono emerse significative carenze nel sistema di controllo interno in relazione al processo di informativa finanziaria da portare all'attenzione del Collegio Sindacale, ai sensi dell'art. 19 del D. Lgs. 27 gennaio 2010, n. 39.
sulla base di quanto sopra esposto e per quanto è stato portato a conoscenza del Collegio Sindacale ed è stato riscontrato dai controlli periodici svolti, anche dal precedente Collegio Sindacale sulla base di quanto appreso dalla lettura di atti e documenti, si ritiene non sussistano ragioni ostative all'approvazione del progetto di bilancio di Beta Stepstone S.p.A. per l'esercizio chiuso al 31 dicembre 2016 così come è stato redatto e Vi è proposto dall'organo di amministrazione di Banca Sistema S.p.A.
Altresì il Collegio Sindacale ha preso atto, e porta alla Vostra attenzione, sia il contenuto della relazione al bilancio della società di revisione legale PWC, emessa ai sensi degli articoli 14 e 16 del D.Lgs. n. 39/2010, dalla quale si evince che il bilancio fornisce una rappresentazione veritiera e corretta della situazione patrimoniale e finanziaria, del risultato economico e dei flussi di cassa della Banca, sia l'esito degli scambi di informazioni intercorsi con la medesima società di revisione, la quale ha confermato la propria indipendenza, non ha rilevato errori significativi, ritiene che la contabilità sia regolarmente tenuta e non vi siano aspetti significativi che chiedano la segnalazione agli organi di Governance.
Come conseguenza di tutto quanto precede, e fermi tutti i rinvii ai fatti intervenuti ed ai singoli paragrafi del Bilancio effettuati in precedenza all'interno di questa Relazione, il Collegio Sindacale Vi invita a deliberare conformemente alla proposta del Consiglio di Amministrazione di Banca Sistema S.p.A. che qui si riporta:
"Signori Azionisti,
vi chiediamo di approvare il Bilancio d'esercizio chiuso il 31 dicembre 2016 con un utile, al netto delle imposte, di Euro 2.734.882.
Tenuto conto dell'intervenuta fusione per incorporazione della Società in Banca Sistema non necessita proporre a livello individuale la relativa destinazione."
***
Milano, 21 marzo 2017
Il Collegio Sindacale
Diego De Francesco Fedele Gubitosi Massimo Conigliaro
Presidente Sindaco Effettivo Sindaco Effettivo
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