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Unicredit Earnings Release 2021
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Earnings Release
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MILAN, 28 JANUARY 2022
UNICREDIT: 4Q21 & FY21 GROUP RESULTS
EXCELLENT 2021 RESULTS DELIVERED DURING A YEAR OF CHANGE, PROVIDING A BLUEPRINT FOR OUR ABILITY TO DELIVER IN 2022 AND BEYOND
Exceeded 2021 key financial guidance with underlying net profit of €3.9 billion, total revenues of €18.0 billion and costs of €9.8 billion
Delivered 7.3 per cent RoTE, EPS of €1.58, positive operating leverage of c. 5 p.p. and cost income ratio of 54.6 per cent in FY21
Strong capital and liquidity position, with FY21 stated CET1 ratio at 15.03 per cent, pro-forma CET1 ratio at 14.13 per cent1 and organic capital generation of €6.52 billion
Meaningful shareholder distribution of c. €3.75 billion, with a proposed cash dividend of c. €1.17 billion and share buyback of c. €2.58 billion
FY21 stated Cost of Risk at 37 basis points, in-line with guidance
Continued strengthening of corporate culture and support to clients' green transition through our Net-Zero commitment, and enhanced Oil & Gas and Coal policies
On 27 January 2022, the Board of Directors of UniCredit S.p.A. ("UniCredit" or "the Group") approved the 4Q21 and FY21 Consolidated Results as at 31 December 2021.
The Bank delivered a strong set of 2021 results, achieving or exceeding all 2021 key financial guidance, with a 7.3 per cent RoTE and a EPS of €1.58.
FY21 underlying net profit reached €3.9 billion, up 2.6 billion full year on full year, exceeding the above €3.7 billion guidance, with an underlying FY21 RoTE of 7.5 per cent. The excellent commercial performance, reflecting the strengths of our unique pan-European franchise, led to total revenues of €4.4 billion in 4Q21, up 4.7 per cent year on year, and €18.0 billion of revenues in FY21, up 4.8 per cent full year on full year, above the €17.5 billion FY21 guidance. This was mainly due to strong fees, up 1.8 per cent quarter on quarter and up 11.7 per cent year on year at €1.7 billion in 4Q21, while FY21 fees were at €6.7 billion, up 12.1 per cent full year on full year. In 4Q21, net interest income (NII) was up 6.0 per cent quarter on quarter to €2.4 billion, benefitting from a positive
1 Stated CET1 ratio includes the deduction for the cash components (dividends at 30 per cent of underlying net profit) of the shareholders' remuneration. Pro-forma CET1 ratio also includes approximately €2.58 billion via share buyback, whose deduction will be executed in 2022 after the ECB will grant the authorisation.
non-recurring tax item in Germany and a recovery in loan demand. In FY21, NII down 4.0 per cent full year on full year at €9.1 billion as a result of lower loans volumes and customer rates.
Quarter on quarter and year on year total costs were almost flat at €2.5 billion in 4Q21, with a positive operating leverage of c. 5 p.p. . Thanks to continued cost discipline, 2021 total costs were also flat versus the prior year at €9.8 billion, more than offsetting the impact of investing in the business, cost inflation and a normalization in variable compensation. Cost/income ratio was 55.7 per cent in 4Q21, up 0.5 p.p. quarter on quarter and down 2.3 p.p. year on year, and 54.6 per cent in FY21, down 2.6 p.p. full year on full year.
Stated cost of risk (CoR) stood at 37 basis points in FY21, down 68 bps full year on full year, with all divisions recording a decreasing trend.
Our asset quality2 remains sound, with Group gross NPE ratio at 3.6 per cent. The stated CET1 ratio ended the quarter at 15.03 per cent and the pro-forma CET1 ratio at 14.13 per cent1 , when deducting c. €2.58 billion share buyback component, above the 13.5-14 per cent FY21 guidance. Tangible equity was €52.8 billion, up 4.4 per cent year on year, while tangible book value per share was €23.9, up 5.7 per cent year on year, mainly thanks to net profit.
Our proposal for an ordinary distribution of €3.75 billion, with a cash dividend of around €1.17 billion and share buyback of around €2.58 billion, will be submitted to the AGM on the 8th of April. The cash dividend is subject to AGM approval, while the buyback is subject to supervisory and AGM approvals. We intend to commence the buyback as soon as possible after approvals.
We are embedding sustainability in all that we do – leading by example in our own business, helping our clients through a fair and positive transition, and contributing towards a better more sustainable society. As part of this, during 2021, we signed up to the Net-Zero Banking Alliance, publicly declaring our commitment to a more sustainable future and we recently enhanced our polices across Coal and Oil & Gas, reinforcing the principles that shape how we operate. The Group continues to progress on its net zero commitments and embed ESG in all areas of the business while strengthening corporate culture under the common purpose to empower our communities to progress.
Key recent events include the following:
- Executed €445 million of the €652 million "Second Share Buy-Back Programme 2021" related to FY20
- €1.75 billion UniCredit SpA Senior Preferred dual tranche successful issuance
- Fitch upgraded UniCredit SpA's ratings to 'BBB' with stable outlook from 'BBB-'
- S&P improved UniCredit SpA's outlook to positive from stable
Andrea Orcel, Chief Executive Officer of UniCredit S.p.A. :
"The excellent 2021 performance is the result of the decisive actions we took during the year, our emerging corporate culture, the dedication of our employees and the continued confidence of our clients. We exceeded our full year targets for revenue, cost and underlying net profit, delivering a RoTE of 7.3 per cent and generating substantial organic capital. Our commitment to significantly increase shareholder returns without impacting our robust capital was reconfirmed, and we intend to distribute a total of €3.75 billion to investors in dividends and share buybacks, pending approvals, whilst also ending the year with a CET1 ratio of 14.13 percent pro-forma for those distributions. This performance is the blueprint for what our new target model can deliver in 2022 and beyond for the benefit of all our stakeholders."
2 NPEs excludes exposures classified as held for sale.
4Q21 KEY FIGURES
- Total Revenues: €4.4 bn, flat Q/Q and up 4.7 per cent Y/Y, mainly driven by strong fees Y/Y
- Net Revenue: €3.6 bn, up 66.4 per cent Y/Y, driven by strong fees Y/Y and positive net interest income Q/Q
- NII: €2.4 bn, up 6.0 per cent Q/Q and up 6.9 per cent Y/Y, mainly driven by a positive non-recurring item
- Fees: €1.7 bn, up 1.8 per cent Q/Q and up 11.7 per cent Y/Y, mainly thanks to investment fees
- − Investment fees: €0.7 bn, up 3.9 per cent Q/Q and up 15.1 per cent Y/Y
- − Financing fees: €0.4 bn, up 2.1 per cent Q/Q and up 4.9 per cent Y/Y
- − Transactional fees: €0.6 bn, down 0.8 per cent Q/Q and up 12.9 per cent Y/Y
- Trading income: €220 m, down 38.0 per cent Q/Q and down 48.5 per cent Y/Y
- Dividends3 : €114 m, down 32.9 per cent Q/Q and down 8.2 per cent Y/Y
- Operating costs: €2.5 bn, up 0.9 per cent Q/Q and up 0.6 per cent Y/Y
- CoR: 4Q21 stated CoR at 74 bps, up 47 bps Q/Q and down 106 bps Y/Y
- Underlying net profit: €0.8 bn, down 26.8 per cent Q/Q
- RoTE: 5.4 per cent, down 3.4 p.p. Q/Q and up 5.1 p.p. Y/Y
- EPS: €1.58
4Q21 CAPITAL & RISK POSITION
- Capital: stated CET1 ratio at 15.03 per cent; pro-forma CET1 ratio at 14.13 per cent1
- Risk Weighted Assets (RWA): RWA stood at €322 bn, down 1.84 per cent Q/Q due to the decrease in credit RWA, operational risk and market risk
- Group gross NPE ratio: 3.6 per cent, improving (-0.9 p.p. both Q/Q and Y/Y)
KEY HIGHLIGHTS
In 4Q21, NII was up 6.0 per cent Q/Q to €2.4 bn, benefitting from a positive non-recurring tax item in Germany and a recovery in loan demand. In FY21, NII was down 4.0 per cent at €9.1 bn as a result of lower loans volumes and customer rates.
Fees delivered another very robust performance at €1.7 bn in 4Q21, up 1.8 per cent Q/Q and 11.7 per cent Y/Y, supported by AuM management fees and transactional fees. FY21 fees were at €6.7 bn, up 12.1 per cent FY/FY, mainly due to investment fees.
Trading income was €220 m in 4Q21, due to the XVA methodology changes, down 38.0 per cent Q/Q and 48.5 per cent Y/Y. FY21 trading income was up 16.0 per cent FY/FY at €1.6 bn, of which €1.3 bn is customer driven, increasing thanks to XVA and FV valuation.
Dividends3 at €114 m in 4Q21, down 32.9 per cent Q/Q and down 8.2 per cent Y/Y with lower contribution from Yapi Kredi (-€56 m Q/Q). FY21 dividends were up 25.2 per cent FY/FY to €520 m, with higher contribution from Yapi Kredi (+€18 m FY/FY).
Operating costs remained almost flat, up 0.9 per cent Q/Q and up 0.6 per cent Y/Y, at €2.5 bn in 4Q21, resulting in a cost/income ratio of 55.7 per cent, up 0.5 p.p. Q/Q and down 2.3 p.p. Y/Y, while remained flat FY/FY at €9.8 bn in FY21, below the €9.9 bn FY21 guidance, with a cost/income ratio of 54.6 per cent, down 2.6 p.p. FY/FY. 4Q21 HR costs were €1.5 bn, up 1.1 per cent Q/Q and 5.2 per cent Y/Y, as a result of a normalisation in variable
3 Include dividends and equity investments. Yapi Kredi is valued by the equity method (at 32 per cent stake for Jan 20 and at 20 per cent thereafter. Starting from Nov21 the contribution was stopped following the classification in held for sale of the Yapi Kredi stake).
compensation, more than offsetting the yearly saving in non-HR costs, which decreased 6.0 per cent Y/Y to €0.9 bn.
Stated CoR stood at 74 bps in 4Q21, mainly due to the regulatory headwinds impact and increase in specific writedowns, and decreased to 37 bps in FY21 from 105 bps, in-line with guidance.
UniCredit reported underlying net profit of €0.8 bn in 4Q21, down €0.3 bn Q/Q and up €0.6 bn Y/Y, and €3.9 bn in FY21, up €2.6 bn FY/FY, exceeding the above €3.7 bn guidance. Stated net profit stood at €1.5 bn in FY21.
UniCredit had a very strong stated CET1 capital ratio of 15.03 per cent and a pro-forma CET1 ratio of 14.13 per cent1 , above the 13.5-14 per cent FY21 guidance. Tangible equity was €52.8 bn, up 4.4 per cent Y/Y, while tangible book value per share was €23.9, up 5.7 per cent Y/Y, mainly thanks to net profit.
Group gross NPEs were €16.3 bn in 4Q21 (-21.3 per cent Q/Q and -23.4 per cent Y/Y) leading to a gross NPE ratio of 3.6 per cent (-0.9 p.p. Q/Q, -0.9 p.p. Y/Y), while Group net NPEs were €7.5 bn in 4Q21 (-15.6 per cent Q/Q and - 12.3 per cent Y/Y), with a net NPE ratio of 1.7 per cent (-0.3 p.p. Q/Q, -0.2 p.p. Y/Y). The coverage ratio was 54.0 per cent (-3.1 p.p. Q/Q and -5.8 p.p. Y/Y).
Group gross bad loans amounted to €4.5 bn in 4Q21 (-32.8 per cent Q/Q, -40.9 per cent Y/Y) with a coverage ratio of 75.1 per cent (-1.1 p.p. Q/Q, -3.3 p.p. Y/Y). Group gross unlikely to pay stood at €10.9 bn (-16.5 per cent Q/Q, -15.1 per cent Y/Y), with a coverage ratio of 46.6 per cent (-2.2 p.p. Q/Q, -3.8 p.p. Y/Y).
Non Core gross NPEs, part of Group gross NPEs, amounted to €0.6 bn, down 77.1 per cent Q/Q and 83.3 per cent Y/Y. The coverage ratio stood at 68.6 per cent in 4Q21 (-10.1 p.p. Q/Q, -10.4 p.p. Y/Y). The Non Core FY21 full rundown has been completed.
Investor Relations: Tel. +39-02-886-21028 e-mail: [email protected] Media Relations: Tel. +39-02-886-23569 e-mail: [email protected]
UNICREDIT 4Q21 & FY21 GROUP RESULTS – DETAILS OF CONFERENCE CALL
MILAN, 28 JANUARY 2022 – 10.00 CET
ITALY: +39 02 802 09 11 UK: +44 1212 818004
USA: +1 718 7058796
THE CONFERENCE CALL WILL ALSO BE AVAILABLE VIA LIVE AUDIO WEBCAST AT
https://www.unicreditgroup.eu/en/investors/group-results.html, WHERE THE SLIDES WILL BE DOWNLOADABLE
UNICREDIT GROUP CONSOLIDATED RESULTS
| (€ million) | FY20 | FY21 | FY/FY | 4Q20 | 3Q21 | 4Q21 | Q/Q | Y/Y |
|---|---|---|---|---|---|---|---|---|
| Total revenues | 17,132 | 17,954 | +4.8% | 4,236 | 4,435 | 4,436 | +0.0% | +4.7% |
| o/w Net interest | 9,441 | 9,060 | -4.0% | 2,250 | 2,271 | 2,406 | +6.0% | +6.9% |
| o/w Fees | 5,968 | 6,692 | +12.1% | 1,504 | 1,650 | 1,680 | +1.8% | +11.7% |
| o/w Trading | 1,412 | 1,638 | +16.0% | 426 | 354 | 220 | -38.0% | -48.5% |
| Operating costs | -9,797 | -9,797 | -0.0% | -2,456 | -2,450 | -2,472 | +0.9% | +0.6% |
| Gross operating profit | 7,335 | 8,158 | +11.2% | 1,780 | 1,985 | 1,963 | -1.1% | +10.3% |
| Net operating profit | 2,339 | 6,524 | n.m. | -278 | 1,688 | 1,153 | -31.7% | n.m. |
| Stated net profit/loss | -2,785 | 1,540 | n.m. | -1,179 | 1,058 | -1,439 | n.m. | +22.1% |
| Underlying net profit/loss | 1,264 | 3,900 | n.m. | 204 | 1,106 | 810 | -26.8% | n.m. |
| CET1 MDA buffer (bps) | 611 | 510 | -101 | 611 | 647 | 510 | -137 | -101 |
| RoTE | 1.7% | 7.3% | 5.6% | 0.3% | 8.8% | 5.4% | -3.4 p.p. | +5.1 p.p. |
| Customers loans excl. repos and IC - bn | 415 | 419 | +1.1% | 415 | 420 | 419 | -0.1% | +1.1% |
| Gross NPE - bn | 21 | 16 | -23.4% | 21 | 21 | 16 | -21.3% | -23.4% |
| Deposits (excl. repos) - bn | 460 | 477 | +3.7% | 460 | 467 | 477 | +2.2% | +3.7% |
| Cost/income ratio | 57.2% | 54.6% | -2.6 p.p. | 58.0% | 55.2% | 55.7% | +0.5 p.p. | -2.3 p.p. |
| Stated cost of risk (bps) | 105 | 37 | -68 | 179 | 27 | 74 | +47 | -106 |
Note: Group underlying net profit exclude the regulatory headwinds impact on CoR (-€3 m in 1Q20, -€4 m in 2Q20, -€3 m in 3Q20, -€519 m in 4Q20, -€85 m in 2Q21, -€52 m in 3Q21 and -€232 m in 4Q21), real estate disposals (+€296 m in 1Q20), real estate valuation (+€9 m in 1Q20, -€7 m in 2Q20, -€5 m in 3Q20, +€23 m in 4Q20, +€4 m in 1Q21, +€18 m in 2Q21, +€4 m in 3Q21 and -€26 m in 4Q21), Non Core rundown (-€98 m in 2Q20, - €4 m in 3Q20 and -€8 m in 4Q20), goodwill impairment (-€878 m in 4Q20), severance (-€1,272 m in 1Q20 and -€735 m in 4Q21), other integration costs (-€221 m in 4Q21), Yapi Kredi deconsolidation (-€1,576 m in 1Q20 and -€1,644 m in 4Q21), legal entity sale (-€554 m in 4Q21) and DTA writeup (+€1,164 m in 4Q21). 4Q21 and FY21 CET1 fully loaded MDA buffer are based on pro-forma figures, while 4Q20, FY20 and 3Q21 CET1 fully loaded MDA buffer are based on stated figures.
Total revenues were flat Q/Q and up 4.7 per cent Y/Y to €4.4 bn in 4Q21, with continued strong fees (+1.8 per cent Q/Q, +11.7 per cent Y/Y) and positive NII (+6.0 per cent Q/Q, +6.9 per cent Y/Y). In FY21, total revenues were up 4.8 per cent FY/FY, to €18.0 bn, above the €17.5 bn FY21 guidance. Net revenue reached €3.6 bn in 4Q21, up 66.4 per cent Y/Y, and €16.3 bn in FY21, up 34.5 per cent FY/FY, above the €16 bn FY21 guidance.
In 4Q21, NII was up 6.0 per cent Q/Q to €2.4 bn, benefitting from a positive non-recurring tax item in Germany (+€123 m) and a recovery in loan demand. Excluding the non-recurring item, NII would be stable Q/Q. This is supported by demand for credit that is showing signs of recovery. Average client loan volumes are up Q/Q driven by Central Europe and Germany. In FY21, NII down 4.0 per cent FY/FY at €9.1 bn as a result of lower average performing loans volumes (-€6.3 bn) and performing loans customer rates (-22 bps).
Fees delivered another very robust performance at €1.7 bn in 4Q21, up 1.8 per cent Q/Q and 11.7 per cent Y/Y, supported by AuM management fees and, in Y/Y only, also by transactional fees. FY21 fees were at €6.7 bn, up 12.1 per cent FY/FY, mainly due to investment fees. In particular:
- − Investment fees generated another good performance in 4Q21, up 3.9 per cent Q/Q and up 15.1 per cent Y/Y with better AUM Management fees mainly in Italy, and in FY21, up 23.4 per cent FY/FY with better AUM Products fees, sustained by better volumes (mainly in Italy);
- − Financing fees were up 2.1 per cent Q/Q and up 4.9 per cent Y/Y in 4Q21, supported by better loans fees (mainly in Germany) and, for Y/Y only, by Credit Protection Insurance in Italy, partially mitigated by lower global capital markets results, while were up 3.7 per cent FY/FY in FY21;
- − Transactional fees were down 0.8 per cent Q/Q, mostly due to lower debit and credit cards fees in Eastern Europe, and up 12.9 per cent Y/Y, driven by higher Current accounts and Payment fees, mainly in Italy, but up 6.5 per cent FY/FY in FY21, mainly thanks to current accounts and card and payment fees.
Trading income was €220 m in 4Q21, due to the XVA methodology changes, down 38.0 per cent Q/Q and 48.5 per cent Y/Y. FY21 trading income was up 16.0 per cent FY/FY at €1.6 bn, thanks to excellent client driven trading, up 22.8 per cent FY/FY as a result of the positive contribution from XVA and other customer driven mainly due to FV valuation.
Dividends3 at €114 m in 4Q21, down 32.9 per cent Q/Q and down 8.2 per cent Y/Y with lower contribution from Yapi Kredi (-€56 m Q/Q). FY21 dividends were up 25.2 per cent FY/FY to €520 m, with higher contribution from Yapi Kredi (+€18 m FY/FY).
Operating costs remained almost flat, up 0.9 per cent Q/Q and up 0.6 per cent Y/Y, at €2.5 bn in 4Q21, resulting in a cost/income ratio of 55.7 per cent, up 0.5 p.p. Q/Q and down 2.3 p.p. Y/Y, while remaining flat FY/FY at €9.8 bn in FY21, below the €9.9 bn FY21 guidance, with a cost/income ratio of 54.6 per cent, down 2.6 p.p. FY/FY. In particular:
- − HR costs were €1.5 bn in 4Q21, up 1.1 per cent Q/Q and 5.2 per cent Y/Y, mainly explained by a normalisation in variable compensation and higher Long Term Incentive, partially offset by lower volumes effect;
- − Non HR costs were €0.9 bn in 4Q21, up 0.7 per cent Q/Q, mainly due to higher Advertising & Marketing and outsourcing costs, and down 6.0 per cent Y/Y.
LLPs4 totalled €810 m in 4Q21, increasing by €513 m Q/Q due to regulatory headwinds and NPE dynamics, affected by flow to default and selling scenario impact in Italy.
The stated CoR reached 74 basis points in 4Q21, up 47 bps Q/Q mainly due to the regulatory headwinds impact and increase in specific writedowns, and decreased to 37 bps in FY21 from 105 bps, in-line with guidance, with all divisions recording a decreasing trend.
In 4Q21 the Group showed positive taxes for €1.3 bn, while the underlying tax rate was 24.2 per cent.
Underlying net profit stood at €0.8 bn in 4Q21, down €0.3 bn Q/Q and up €0.6 bn Y/Y, and at €3.9 bn in FY21, up €2.6 bn FY/FY, exceeding the above €3.7 bn guidance, to an underlying RoTE of 7.5 per cent. Stated net profit stood at €1.5 bn in FY21.
BALANCE SHEET
Average gross commercial performing loans were €400 bn5 as of 31 Dec 21 (+1.5 per cent Q/Q, +2.4 per cent Y/Y). The main contributors were Italy (€164 bn), Germany (€109 bn) and Central Europe (€85 bn).
Gross customer performing loan rates were down 2 bps Q/Q at 1.95 per cent5 in 4Q21 and down 12 bps Y/Y.
Group average commercial deposits increased to €464 bn5 as of 31 Dec 21 (+2.5 per cent Q/Q, +5.2 per cent Y/Y). The main contributors were Italy (€191 bn), Germany (€132 bn) and Central Europe (€90 bn).
Customer deposits rates were up 2 bps Q/Q at 0.05 per cent5 in 4Q21 and almost flat Y/Y.
4 LLPs include among others: IFRS9 macro-economic scenario update, sector based provisioning, IFRS9 methodological enhancements, proactive classification and coverage increases in Stage 2, where relevant. 5 Includes Group Corporate Centre and Non Core.
Total Financial Assets (TFAs) increased by 2.2 per cent Q/Q and 7.6 per cent Y/Y, reaching €805 bn in 4Q21:
- − AuM: €223 bn in 4Q21, up 2.3 per cent Q/Q and up 9.7 per cent Y/Y;
- − AuC: €169 bn in 4Q21, up 2.0 per cent Q/Q and up 15.9 per cent Y/Y;
- − Deposits: at €412 bn, up 2.2 percent Q/Q and up 3.5 per cent Y/Y.
ASSET QUALITY2
Group gross NPEs were €16.3 bn in 4Q21 (-21.3 per cent Q/Q and -23.4 per cent Y/Y) leading to a gross NPE ratio of 3.6 per cent (-0.9 p.p. Q/Q, -0.9 p.p. Y/Y), while Group net NPEs were €7.5 bn in 4Q21 (-15.6 per cent Q/Q and - 12.3 per cent Y/Y), with a net NPE ratio of 1.7 per cent (-0.3 p.p. Q/Q, -0.2 p.p. Y/Y). The coverage ratio was 54.0 per cent (-3.1 p.p. Q/Q and -5.8 p.p. Y/Y).
Group gross bad loans amounted to €4.5 bn in 4Q21 (-32.8 per cent Q/Q, -40.9 per cent Y/Y) with a coverage ratio of 75.1 per cent (-1.1 p.p. Q/Q, -3.3 p.p. Y/Y). Group gross unlikely to pay stood at €10.9 bn (-16.5 per cent Q/Q, -15.1 per cent Y/Y), with a coverage ratio of 46.6 per cent (-2.2 p.p. Q/Q, -3.8 p.p. Y/Y).
Non Core gross NPEs, part of Group gross NPEs, amounted to €0.6 bn, down 77.1 per cent Q/Q and down 83.3 per cent Y/Y. Coverage ratio stood at 68.6 per cent in 4Q21 (-10.1 p.p. Q/Q, -10.4 p.p. Y/Y). Non Core FY21 full rundown has been completed.
CAPITAL & FUNDING
The Group stated CET1 ratio is strong at 15.03 per cent, with €6.52 bn organic capital generation in 2021. The pro-forma CET1 ratio stood at 14.13 per cent1 , above the 13.5-14 per cent FY21 guidance, mainly driven by +200 bps from organic capital generation, -132 bps from distribution, -71 bps from regulatory headwinds and -72 bps from other items6 . Leverage ratio transitional pro-forma stood at 5.41 per cent in FY21.
Our proposal for an ordinary distribution of €3.75 bn, with a cash dividend of around €1.17 bn and share buyback of around €2.58 bn, will be submitted to the AGM on the 8th of April. The cash dividend is subject to AGM approval, while the buyback is subject to supervisory and AGM approvals. We intend to commence the buyback as soon as possible after approvals.
RWAs totalled €322 bn in 4Q21, down 1.84 per cent Q/Q, due to the decrease in credit RWA (-€4.7 bn), operational risk (-€0.8 bn) and market risk (-€0.6 bn).
The 2021 Funding Plan has been mostly focused on MREL instruments in preparation for the upcoming intermediate requirement in 2022, while bank capital needs remained quite limited. UniCredit runs substantial buffers above its TLAC requirements of greater than 19.55 per cent7with a 4Q21 stated TLAC transitional ratio of 25.45 per cent and a stated TLAC MDA transitional buffer of 590 bps.
6 Including non-operating items.
7 4Q21 stated TLAC transitional ratio 25.45 per cent (o/w 22.95 per cent stated TLAC subordination ratio and 2.5 per cent senior preferred exemption) and stated TLAC MDA buffer of 590 bps. Current requirement 19.55 per cent (assuming combined capital buffer as of 4Q21) with 2.50 per cent senior exemption. Starting from 01 Jan 22, fully loaded requirement 21.55 per cent (assuming combined capital buffer as of 4Q21) with 3.50 per cent senior exemption.
DIVISIONAL HIGHLIGHTS8
ITALY
| (€ million) | 4Q20 | 3Q21 | 4Q21 | Q/Q | Y/Y |
|---|---|---|---|---|---|
| Total revenues | 1,986 | 2,054 | 2,021 | -1.6% | +1.8% |
| o/w Net Interest | 997 | 892 | 888 | -0.4% | -10.9% |
| o/w Fees | 938 | 1,037 | 1,056 | +1.8% | +12.6% |
| Operating costs | -987 | -994 | -989 | -0.5% | +0.3% |
| Gross operating profit | 999 | 1,060 | 1,031 | -2.7% | +3.2% |
| Net operating profit | -201 | 853 | 675 | -20.8% | n.m. |
| Stated Net profit/loss | -238 | 482 | 864 | +79.4% | n.m. |
| Underlying Net Profit | 155 | 510 | 387 | -24.1% | n.m. |
| Stated RoAC | -5.8% | 12.8% | 23.2% | +10.4 p.p. | +29.0 p.p. |
| Underlying RoAC | 3.8% | 13.6% | 10.4% | -3.2 p.p. | +6.6 p.p. |
| Cost/income ratio | 49.7% | 48.4% | 49.0% | +0.6 p.p. | -0.7 p.p. |
| Cost of risk (bps) | 236 | 45 | 79 | +35 | -157 |
GERMANY
| (€ million) | 4Q20 | 3Q21 | 4Q21 | Q/Q | Y/Y |
|---|---|---|---|---|---|
| Total revenues | 1,120 | 1,078 | 1,128 | +4.6% | +0.7% |
| o/w Net Interest | 555 | 639 | 716 | +12.0% | +28.9% |
| o/w Fees | 237 | 257 | 257 | -0.1% | +8.5% |
| Operating costs | -695 | -650 | -668 | +2.9% | -3.9% |
| Gross operating profit | 425 | 429 | 459 | +7.2% | +8.2% |
| Net operating profit | 249 | 375 | 366 | -2.3% | +47.0% |
| Stated Net profit | 133 | 228 | -285 | n.m. | n.m. |
| Underlying Net Profit | 134 | 228 | 280 | +22.9% | n.m. |
| Stated RoAC | 5.2% | 9.6% | -12.1% | -21.6 p.p. | -17.3 p.p. |
| Underlying RoAC | 5.2% | 9.6% | 11.9% | +2.3 p.p. | +6.7 p.p. |
| Cost/income ratio | 62.1% | 60.3% | 59.3% | -1.0 p.p. | -2.8 p.p. |
| Cost of risk (bps) | 55 | 17 | 30 | +13 | -25 |
8 Please consider that (i) all divisional figures in "Divisional Highlights" represent the contribution of each division to Group data; (ii) Return on Allocated Capital (RoAC) related to each division and shown in this section is calculated as: annualised net profit / allocated capital. Allocated capital based on RWA equivalent figures calculated with a CET1 ratio target of 11.75 per cent as for plan horizon, including deductions for shortfall and securitisations.
CENTRAL EUROPE (€ million) 4Q20 3Q21 4Q21 Q/Q Y/Y Total revenues 729 763 763 +0.2% +3.6% o/w Net Interest 393 406 439 +8.5% +10.6% o/w Fees 228 233 250 +7.3% +9.0% Operating costs -422 -417 -431 +3.6% +1.6% Gross operating profit 308 346 332 -3.9% +6.3% Net operating profit 8 324 162 -50.1% n.m. Stated Net profit/loss 1 266 -176 n.m. n.m. Underlying Net Profit 53 279 235 -15.8% n.m. Stated RoAC -0.4% 16.6% -11.0% -27.6 p.p. -10.6 p.p. Underlying RoAC 3.0% 17.5% 14.0% -3.4 p.p. +11.0 p.p. Cost/income ratio 57.8% 54.6% 56.5% +1.8 p.p. -1.3 p.p. Cost of risk (bps) 139 10 76 +66 -64
Note: Stated numbers at current FX. Variations Q/Q and Y/Y are at constant FX (underlying net profit, stated RoAC, underlying RoAC, C/I and CoR variations at current FX).
| (€ million) | 4Q20 | 3Q21 | 4Q21 | Q/Q | Y/Y |
|---|---|---|---|---|---|
| Total revenues | 522 | 588 | 601 | +1.1% | +11.6% |
| o/w Net Interest | 371 | 394 | 422 | +6.1% | +10.6% |
| o/w Fees | 122 | 134 | 131 | -2.3% | +5.2% |
| Operating costs | -244 | -253 | -262 | +2.5% | +4.8% |
| Gross operating profit | 278 | 335 | 339 | +0.0% | +17.4% |
| Net operating profit | 26 | 309 | 175 | -45.3% | n.m. |
| Stated Net profit | -16 | 223 | 119 | -49.3% | n.m. |
| Underlying Net Profit | 30 | 229 | 186 | -19.1% | n.m. |
| Stated RoAC | -3.1% | 19.5% | 8.6% | -10.9 p.p. | +11.6 p.p. |
| Underlying RoAC | 0.9% | 20.0% | 15.0% | -5.0 p.p. | +14.1 p.p. |
| Cost/income ratio | 46.8% | 43.0% | 43.6% | +0.6 p.p. | -3.2 p.p. |
| Cost of risk (bps) | 262 | 26 | 161 | +135 | -100 |
EASTERN EUROPE
Note: Stated numbers at current FX. Variations Q/Q and Y/Y are at constant FX (underlying net profit, stated RoAC, underlying RoAC, C/I and CoR variations at current FX).
GROUP CORPORATE CENTRE (GCC)
| (€ million) | 4Q20 | 3Q21 | 4Q21 | Q/Q | Y/Y |
|---|---|---|---|---|---|
| Total revenues | -100 | -38 | -58 | +52.4% | -42.2% |
| Operating costs | -88 | -119 | -107 | -10.1% | +21.7% |
| Gross operating profit | -188 | -157 | -165 | +5.1% | -12.3% |
| Stated net loss | -874 | -121 | -1,926 | n.m. | n.m. |
| Underlying net profit/loss | 9 | -120 | -246 | n.m. | n.m. |
| FTE | 10,347 | 10,123 | 10,058 | -0.6% | -2.8% |
| Costs GCC/total costs | 3.6% | 4.9% | 4.3% | -0.5 p.p. | +0.7 p.p. |
NON CORE
| (€ million) | 4Q20 | 3Q21 | 4Q21 | Q/Q | Y/Y |
|---|---|---|---|---|---|
| Total revenues | -21 | -10 | -19 | +81.4% | -8.3% |
| Operating costs | -21 | -17 | -15 | -13.7% | -29.6% |
| Gross operating profit | -42 | -27 | -34 | +22.4% | -19.0% |
| LLP | -121 | 17 | -24 | n.m. | -80.0% |
| Stated net profit/loss | -185 | -20 | -36 | +78.8% | -80.8% |
| Undelying net profit/loss | -177 | -20 | -33 | +62.3% | -81.3% |
| Gross customer loans | 3,693 | 2,702 | 618 | -77.1% | -83.3% |
| NPE coverage ratio | 79.0% | 78.7% | 68.6% | -10.1 p.p. | -10.4 p.p. |
| Net NPEs | 775 | 576 | 194 | -66.2% | -74.9% |
| RWA | 7,642 | 5,032 | 361 | -92.8% | -95.3% |
SIGNIFICANT EVENTS DURING AND AFTER 4Q21
With reference to the main events that occurred during 4Q21 and after 31 Dec 21, refer to the press releases published on the UniCredit Group website. Here below therefore, the main price-sensitive financial press releases published after 31 Dec 21:
− "UniCredit: update on the execution of the share buy-back programme during the period from 27 to 30 December 2021" (press release published on 03 Jan 22);
− "UniCredit: update on the execution of the share buy-back programme during the period from 3 to 7 January 2022" (press release published on 10 Jan 22);
− "UniCredit successfully issues dual tranche Senior Preferred Notes for a total amount of EUR 1.75 billion" (press release published on 11 Jan 22).
− "UniCredit: update on the execution of the share buy-back programme during the period from 10 to 14 January 2022" (press release published on 17 Jan 22);
− "UniCredit: update on the execution of the share buy-back programme during the period from 17 to 21 January 2022" (press release published on 24 Jan 22).
ECONOMIC OUTLOOK
The global recovery from the COVID-19-induced collapse in economic activity continues. However, severe and persistent supply bottlenecks and high inflation are likely to slow the pace of growth this year. We expect global GDP to grow by 4.2 per cent in 2022, after 5.8 per cent in 2021. In the euro area, we expect GDP growth to slow from 5.2 per cent in 2021 to 3.9 per cent this year. The Omicron variant of COVID-19 is adding to headwinds in the short term and is expected to have contributed to dampening activity at the turn of the year. However, we expect that its impact on the growth trajectory for 2022 should be contained. Activity is likely to reaccelerate to a robust pace starting in the spring, also benefitting from a gradual easing of bottlenecks and a deceleration in inflation. In Italy, following a 6.3 per cent increase in 2021, we expect GDP growth to continue at 4.1 per cent in 2022. While it is less exposed than Germany, Italy will not escape the negative impact of persistent supply-side bottlenecks on manufacturing activity in the first half of 2022. Domestic demand will be the main growth engine. Several tailwinds, in particular, will continue to support fixed investment, such as public resources, the EU recovery funds and financing conditions, which should remain favorable. With regard to the European Central Bank, we expect asset purchases to continue into 2023 and no rate hikes before 2024. Geopolitical risk and, in particular, the risk related to an escalation of tensions between Russia and Ukraine, might weigh on the economic outlook. The negative economic impact is expected to mainly come from a potential energy shock, especially for countries more vulnerable such as Germany, possible tensions in financial markets and, to a lesser extent, through the trade channel. Lingering inflation pressure might induce earlier and/or bolder action by central banks, weighing on economic growth and investors' confidence and fuelling volatility in global markets.
DISCLAIMER
For the sake of completeness about the results as of 31 Dec 21, the reclassified consolidated income statement and the reclassified consolidated balance sheet approved by the Board of Directors are here attached. The parent company draft financial statements and the consolidated financial statements as at 31 Dec 21 will be submitted for approval at the meeting of the Board of Directors scheduled for 15 Feb 22. The parent company draft Financial Statements and the Consolidated Financial Statements as at 31 Dec 21, together with the Independent Auditors' Report and the Report of the Board of Statutory Auditors, will be made publicly available according to the regulatory terms (17 Mar 22). The parent company financial statements will be submitted for the approval of shareholders at the Ordinary Meeting scheduled for 8 Apr 22.
GROUP TABLES
UNICREDIT GROUP: RECLASSIFIED INCOME STATEMENT
| (€ million) | FY20 | FY21 | FY/FY | 4Q20 | 3Q21 | 4Q21 | Q/Q | Y/Y |
|---|---|---|---|---|---|---|---|---|
| Net interest | 9,441 | 9,060 | -4.0% | 2,250 | 2,271 | 2,406 | +6.0% | +6.9% |
| Dividends and other income from equity investments | 415 | 520 | +25.2% | 124 | 169 | 114 | -32.9% | -8.2% |
| Net fees and commissions | 5,968 | 6,692 | +12.1% | 1,504 | 1,650 | 1,680 | +1.8% | +11.7% |
| Net trading income | 1,412 | 1,638 | +16.0% | 426 | 354 | 220 | -38.0% | -48.5% |
| Net other expenses/income | (104) | 45 | n.m. | (69) | (10) | 16 | n.m. | n.m. |
| OPERATING INCOME | 17,132 | 17,954 | +4.8% | 4,236 | 4,435 | 4,436 | +0.0% | +4.7% |
| Payroll costs | (5,968) | (6,022) | +0.9% | (1,456) | (1,515) | (1,532) | +1.1% | +5.2% |
| Other administrative expenses | (3,215) | (3,190) | -0.8% | (825) | (783) | (804) | +2.7% | -2.5% |
| Recovery of expenses | 523 | 548 | +4.7% | 147 | 134 | 150 | +11.6% | +2.0% |
| Amort. deprec. and imp. losses on intang. & tang. assets | (1,137) | (1,133) | -0.4% | (323) | (286) | (286) | +0.2% | -11.3% |
| OPERATING COSTS | (9,797) (9,797) | -0.0% | (2,456) (2,450) (2,472) | +0.9% | +0.6% | |||
| OPERATING PROFIT (LOSS) | 7,335 | 8,158 | +11.2% | 1,780 | 1,985 | 1,963 | -1.1% | +10.3% |
| Net write-downs on loans and provisions for guarantees and commitments | (4,996) | (1,634) | -67.3% | (2,058) | (297) | (810) | n.m. | -60.6% |
| NET OPERATING PROFIT (LOSS) | 2,339 | 6,524 | n.m. | (278) | 1,688 | 1,153 | -31.7% | n.m. |
| Other charges and provisions | (1,055) | (1,386) | +31.4% | (91) | (195) | (274) | +40.7% | n.m. |
| - of which: systemic charges | (958) | (1,037) | +8.3% | (53) | (200) | (92) | -53.8% | +73.7% |
| Integration costs | (1,464) | (1,337) | -8.7% | (82) | (4) | (1,327) | n.m. | n.m. |
| Net income from investments | (1,365) | (2,565) | +87.9% | 130 | (59) | (2,325) | n.m. | n.m. |
| PROFIT (LOSS) BEFORE TAX | (1,546) | 1,236 | n.m. | (322) | 1,430 | (2,772) | n.m. | n.m. |
| Income tax for the period | (344) | 330 | n.m. | (34) | (362) | 1,338 | n.m. | n.m. |
| NET PROFIT (LOSS) | (1,890) | 1,566 | n.m. | (356) | 1,068 | (1,434) | n.m. | n.m. |
| Profit (Loss) from non-current assets held for sale after tax | 49 | 4 | -92.2% | 48 | 0 | 2 | n.m. | -95.3% |
| PROFIT (LOSS) FOR THE PERIOD | (1,842) | 1,570 | n.m. | (308) | 1,068 | (1,432) | n.m. | n.m. |
| Minorities | (7) | (30) | n.m. | 8 | (10) | (8) | -24.6% | n.m. |
| NET PROFIT (LOSS) ATTRIBUTABLE TO THE GROUP BEFORE PPA | (1,849) | 1,540 | n.m. | (300) | 1,058 | (1,439) | n.m. | n.m. |
| Purchase Price Allocation effect | (50) | (1) | -98.6% | (0) | (0) | (0) | +0.0% | -100.0% |
| Goodwill impairment | (886) | - | n.m. | (878) | - | - | n.m. | n.m. |
| NET PROFIT (LOSS) ATTRIBUTABLE TO THE GROUP | (2,785) | 1,540 | n.m. | (1,179) 1,058 | (1,439) | n.m. | +22.1% |
Note: Figures of Reclassified consolidated income statement have been restated, starting from June 2021 and with reference to 2020 quarters and first quarter 2021, for the external service costs related to credit cards in Austria from item "Other administrative expenses" to item "Net fees and commissions".
UNICREDIT GROUP: RECLASSIFIED BALANCE SHEET
| (€ million) | 4Q20 | 3Q21 | 4Q21 | Q/Q | Y/Y |
|---|---|---|---|---|---|
| ASSETS | |||||
| Cash and cash balances | 117,003 | 135,412 | 107,407 | -20.7% | -8.2% |
| Financial assets held for trading | 72,705 | 80,545 | 80,109 | -0.5% | +10.2% |
| Loans to banks | 96,519 | 98,379 | 82,938 | -15.7% | -14.1% |
| Loans to customers | 450,550 | 439,811 | 437,544 | -0.5% | -2.9% |
| Other financial assets | 153,349 | 157,104 | 157,902 | +0.5% | +3.0% |
| Hedging instruments | 7,687 | 5,553 | 4,576 | -17.6% | -40.5% |
| Property, plant and equipment | 9,939 | 9,582 | 8,911 | -7.0% | -10.3% |
| Goodwill | - | - | - | n.m. | n.m. |
| Other intangible assets | 2,117 | 2,205 | 2,213 | +0.4% | +4.5% |
| Tax assets | 13,097 | 12,402 | 13,551 | +9.3% | +3.5% |
| Non-current assets and disposal groups classified as held for sale | 2,017 | 832 | 14,287 | n.m. | n.m. |
| Other assets | 6,473 | 6,760 | 7,234 | +7.0% | +11.8% |
| Total assets | 931,456 | 948,584 | 916,671 | -3.4% | -1.6% |
| LIABILITIES AND SHAREHOLDERS' EQUITY | - | ||||
| Deposits from banks | 172,465 | 181,186 | 162,561 | -10.3% | -5.7% |
| Deposits from customers | 498,440 | 509,794 | 500,504 | -1.8% | +0.4% |
| Debt securities issued | 102,524 | 98,518 | 95,898 | -2.7% | -6.5% |
| Financial liabilities held for trading | 47,787 | 49,863 | 51,608 | +3.5% | +8.0% |
| Other financial liabilities | 12,887 | 11,802 | 11,616 | -1.6% | -9.9% |
| Hedging instruments | 11,764 | 7,045 | 5,265 | -25.3% | -55.2% |
| Tax liabilities | 1,358 | 1,243 | 1,216 | -2.2% | -10.4% |
| Liabilities included in disposal groups classified as held for sale | 761 | 576 | 2,149 | n.m. | n.m. |
| Other liabilities | 23,529 | 25,907 | 23,760 | -8.3% | +1.0% |
| Minorities | 435 | 463 | 465 | +0.5% | +7.0% |
| Group Shareholders' Equity: | 59,507 | 62,186 | 61,628 | -0.9% | +3.6% |
| - Capital and reserves | 62,292 | 59,207 | 60,089 | +1.5% | -3.5% |
| - Net profit (loss) | (2,785) | 2,979 | 1,540 | -48.3% | n.m. |
| Total liabilities and Shareholders' Equity | 931,456 | 948,584 | 916,671 | -3.4% | -1.6% |
Note: Figures of Reclassified consolidated balance sheet relating to 2020 and the first three quarters of 2021 have been restated in order to reflect the Banca d'Italia Circular 262 dated 22 December 2005 (7th update of 29 October 2021) through the reclassification of current accounts and demand deposits with Banks and Central Banks (with the exclusion of the mandatory reserve) from item "Loans to banks" to item "Cash and cash balances".
UNICREDIT GROUP: SOVEREIGN DEBT SECURITIES – BREAKDOWN BY COUNTRY/PORTFOLIO
With reference to the Group's sovereign exposures9 , the book value of sovereign debt securities as at 31 Dec 21 amounted to €114,690 m (of which 111,096 m classified in the banking book10), over the 84 per cent of it concentrated in eight countries; Italy, with €43,121 m, represents about 38 per cent of the total. For each of the eight countries, the following table shows the nominal value, the book value and the fair value of the exposures broken down by portfolio as at 31 Dec 21.
9 Information on Sovereign exposures refers to the scope of the UniCredit Group consolidated Annual Report as at 31 December 2021, determined under IAS/IFRS. Sovereign exposures are bonds issued by and loans given to central and local governments and governmental bodies. To the purpose of this risk exposure are not included: • Sovereign exposures of Group's Legal entities classified as held for sale as at 31 December 2021
• ABSs.
10 The banking book includes financial assets designated at fair value, those mandatorily at fair value, those at fair value through other comprehensive income and those at amortised cost.
| (€ million) | Nominal Value | Book value | Fair Value |
|---|---|---|---|
| As at 31 December 2021 | |||
| - Italy | 41,703 | 43,121 | 43,477 |
| financial assets/liabilities held for trading (net exposures)(*) | (1,050) | (1,755) | (1,755) |
| financial assets designated at fair value | - | - | - |
| financial assets mandatorily at fair value | 50 | 62 | 62 |
| financial assets at fair value through other comprehensive income | 19,071 | 20,293 | 20,293 |
| financial assets at amortised cost | 23,632 | 24,521 | 24,877 |
| - Spain | 16,504 | 17,222 | 17,323 |
| financial assets/liabilities held for trading (net exposures)(*) | 1,105 | 1,173 | 1,173 |
| financial assets designated at fair value | - | - | - |
| financial assets mandatorily at fair value | - | - | - |
| financial assets at fair value through other comprehensive income | 4,454 | 4,680 | 4,680 |
| financial assets at amortised cost | 10,945 | 11,369 | 11,470 |
| - Germany | 10,794 | 11,075 | 11,097 |
| financial assets/liabilities held for trading (net exposures)(*) | 846 | 948 | 948 |
| financial assets designated at fair value | - | - | - |
| financial assets mandatorily at fair value | 3,522 | 3,564 | 3,564 |
| financial assets at fair value through other comprehensive income | 2,674 | 2,753 | 2,753 |
| financial assets at amortised cost | 3,752 | 3,810 | 3,832 |
| - Japan | 10,290 | 10,462 | 10,465 |
| financial assets/liabilities held for trading (net exposures)(*) | - | - | - |
| financial assets designated at fair value | - | - | - |
| financial assets mandatorily at fair value | - | - | - |
| financial assets at fair value through other comprehensive income | 6,682 | 6,730 | 6,730 |
| financial assets at amortised cost | 3,608 | 3,732 | 3,735 |
| - United States of America | 4,154 | 4,318 | 4,318 |
| financial assets/liabilities held for trading (net exposures)(*) | 1,074 | 1,101 | 1,101 |
| financial assets designated at fair value | - | - | - |
| financial assets mandatorily at fair value | - | - | - |
| financial assets at fair value through other comprehensive income | 3,058 | 3,195 | 3,195 |
| financial assets at amortised cost | 22 | 22 | 22 |
| - Austria | 3,888 | 4,171 | 4,169 |
| financial assets/liabilities held for trading (net exposures)(*) | 180 | 239 | 239 |
| financial assets designated at fair value | - | - | - |
| financial assets mandatorily at fair value | 100 | 134 | 134 |
| financial assets at fair value through other comprehensive income | 3,464 | 3,648 | 3,648 |
| financial assets at amortised cost | 144 | 150 | 148 |
| - France | 3,474 | 3,783 | 3,772 |
| financial assets/liabilities held for trading (net exposures)(*) | 747 | 978 | 978 |
| financial assets designated at fair value | 221 | 243 | 243 |
| financial assets mandatorily at fair value | 191 | 221 | 221 |
| financial assets at fair value through other comprehensive income | 1,867 | 1,887 | 1,887 |
| financial assets at amortised cost | 448 | 454 | 443 |
| - Romania | 2,312 | 2,417 | 2,327 |
| financial assets/liabilities held for trading (net exposures)(*) | 126 | 123 | 123 |
| financial assets designated at fair value | - | - | - |
| financial assets mandatorily at fair value | - | - | - |
| financial assets at fair value through other comprehensive income | 652 | 687 | 687 |
| financial assets at amortised cost | 1,534 | 1,607 | 1,517 |
| Total on-balance sheet exposures | 93,119 | 96,569 | 96,948 |
Note: (*) Including exposures in Credit Derivatives. In case of negative amount, it indicates the prevalence of liabilities positions.
UNICREDIT GROUP: WEIGHTED DURATION
The weighted duration of the sovereign bonds shown in the table above, divided by the banking and trading book, is the following:
| Weighted duration | TRADING BOOK | ||||
|---|---|---|---|---|---|
| (years) | Banking book | Assets positions | Liabilities positions | ||
| - Italy | 3.82 | 3.22 | 5.17 | ||
| - Spain | 3.75 | 14.78 | 12.09 | ||
| - Germany | 3.02 | 19.45 | 5.21 | ||
| - Japan | 3.35 | - | - | ||
| - United States of America | 2.93 | 21.80 | - | ||
| - Austria | 5.31 | 10.68 | 8.52 | ||
| - France | 6.52 | 21.92 | 23.89 | ||
| - Romania | 4.06 | 4.78 | 7.80 |
The remaining 16 per cent of the total of sovereign debt securities, amounting to €18,121 m with reference to the book values as at 31 Dec 21, is divided into 35 countries, including Bulgaria (€2,228 m), Croatia (€1,778 m), Hungary (€1,696 m), Portugal (€1,636 m), Czech Republic (€1,136 m), Russia (€1,087 m), Ireland (€1,087 m), Serbia (€969 m), China (€770 m), Poland (€739 m) and Israel (€535 m). The sovereign exposure to Greece is immaterial.
With respect to these exposures, as at 31 Dec 21 there were no indications that default may have occurred.
It should also be noted that among the aforementioned remaining part of sovereign debt securities as at 31 Dec 21 there are also debt securities towards Supranational Organisations such as the European Union, the European Financial Stability Facility and the European Stability Mechanism amounting to €2,680 m. In addition to the exposures to sovereign debt securities, loans11 given to central and local governments, governmental bodies must be taken into account, amounting to €31,068 m as at 31 Dec 21, of which about 60 per cent to Germany, Austria and Italy.
UNICREDIT GROUP: RATINGS
| SHORT-TERM DEBT |
MEDIUM AND LONG-TERM |
OUTLOOK | STANDALONE RATING |
|
|---|---|---|---|---|
| Standard & Poor's | A-2 | BBB | POSITIVE | bbb |
| Moody's | P-2 | Baa1 | STABLE | baa3 |
| Fitch Ratings | F2 | BBB | STABLE | bbb |
GENERAL NOTES
- Numbers throughout the press release may not add up precisely to the totals provided in tables and text due to rounding.
- Shareholders distribution subject to supervisory and AGM approvals.
MAIN DEFINTIONS
• Average commercial deposits (excluding repurchase agreements – repos) are managerial figures and are calculated as daily averages. Deposits net of Group bonds are placed by the network.
11 Tax items are not included.
- Average gross commercial performing loans defined as average stock for the period of performing loans to commercial clients (e.g. excluding markets counterparts and operations); managerial figures, key driver of the NII generated by the network activity.
- Cost of risk (CoR) is based on reclassified P&L and Balance sheet, calculated as (i) LLPs of the period (annualized in the interim periods) over (ii) by average loans to customers (including active repos) excluding debt securities (also IFRS5 reclassified assets are excluded).
- Coverage ratio (on NPE) defined as stock of LLPs on NPEs over gross NPEs excluding IFRS5 reclassified assets.
- EPS 2021 calculated as net profit average number of diluted shares (i.e. outstanding shares excluding average treasury and CASHES usufruct shares).
- Gross customer performing deposits rates calculated assuming 365 days convention, adjusted for 360 days convention where analytically available, and based on average gross balances.
- Gross customer performing loan rates calculated assuming 365 days convention, adjusted for 360 days convention where analytically available, and based on average gross balances.
- Gross NPE ratio defined as (i) gross NPEs over (ii) gross loans (including repurchase agreements repos) excluding debt securities and IFRS5 reclassified assets.
- Gross NPEs defined as non performing exposures before deduction of provisions comprising bad loans, unlikely to pay, and past due; including only loans to customers (including repurchase agreements – repos), excluding debt securities and IFRS5 reclassified assets.
- IFRS5 reclassified assets means exposures classified as Held for Sale.
- Net NPE ratio defined as (i) Net NPEs over (i) total loans (including repurchase agreements repos), excluding debt securities and IFRS5 reclassified assets.
- Net NPEs defined as non performing exposures after deduction of provisions comprising bad loans, unlikely to pay, and past due; including only loans to customers (including repurchase agreements – repos), excluding debt securities and IFRS5 reclassified assets.
- Net profit means stated net profit (for 2021 underlying net profit) adjusted for AT1, CASHES coupons and impacts from DTAs from tax loss carry forward sustainability test.
- Net revenue means (i) revenue minus (ii) Loan Loss Provisions (LLPs).
- Operating leverage calculated as revenue CAGR 2021-2024 minus cost CAGR 2021-2024.
- Organic capital generation calculated as (net profit pre AT1 & CASHES (underlying net profit in 2021) less delta RWA excluding regulatory headwinds x CET1 ratio actual) / RWA.
- Regulatory headwinds are mostly driven by regulatory changes and model maintenance (impacting on both P&L, RWA and capital), shortfall and calendar provisioning (impacting on capital).
- RoTE means Strategy Day RoTE defined as (i) net profit over (ii) average tangible equity excluding AT1, CASHES and DTA from tax loss carry forward contribution.
- Share buyback defined as repurchasing of shares by the company that issued them to reduce the number of shares available on the open market.
- Stated net profit means accounting net profit.
- Tangible book value per share calculated as end-of-period tangible book value per share equals end-ofperiod tangible equity over end-of-period number of shares excluding treasury shares.
- Tangible equity defined as shareholders' equity (including consolidated profit of the period) less intangible assets (goodwill and other intangibles), less AT1 component.
- TFAs refers to Group commercial Total Financial Assets. Non-commercial elements, i.e. CIB, Group Corporate Centre, Non Core and Leasing/Factoring are excluded. Numbers are managerial figures.
- Underlying net profit means stated net profit adjusted for non-operating items.
- Underlying RoTE means (i) underlying net profit as defined above, over (ii) average tangible equity.
- Valuation adjustments (XVA) include: Debt/Credit Value Adjustment (DVA/CVA), Funding Valuation Adjustments (FuVA) and Hedging desk.
Declaration by the Manager charged with preparing the financial reports
The undersigned, Stefano Porro, in his capacity as the Manager charged with preparing UniCredit S.p.A.'s financial reports
DECLARES
that, pursuant to Article 154 bis, paragraph 2, of the "Consolidated Law on Finance", the information disclosed in this document corresponds to the accounting documents, books and records.
Milan, 27 January 2022