Asia FX rises; US-Japan trade deal boosts yen, won to 2-week highs
Investing.com -- UniCredit (BIT:CRDI) on Wednesday raised its full-year 2025 net profit guidance to around €10.5 billion after posting a record second-quarter net profit of €3.3 billion, up 24.8% from a year earlier and 20.7% from the previous quarter.
The bank also reported a first-half net profit of €6.1 billion, its highest ever.
Adjusted net profit excluding one-offs rose 8% year on year to €2.9 billion in the quarter.
Return on tangible equity climbed to 24.1% from 22% in the first quarter and 19.8% in the same period last year.
Total (EPA:TTEF) revenues fell 3.3% to €6.1 billion, due in part to a €335 million hit to trading income from hedging costs tied to the Commerzbank (ETR:CBKG) equity consolidation.
Net interest income declined 2.8% year on year to €3.46 billion from €3.56 billion. Fees slipped 1% to €2.1 billion, while trading income dropped 57.7% to €192 million.
Operating costs rose 0.7% year on year to €2.3 billion. The cost-income ratio increased to 37.8% from 36.3% a year earlier. Gross operating profit declined 5.5% to €3.8 billion.
Loan loss provisions rose to €109 million, pushing the cost of risk to 10 basis points from 1 basis point a year ago.
The gross non-performing exposure (NPE) ratio held steady at 2.6%, with overlays of €1.7 billion maintained. Gross NPEs stood at €11.7 billion and net NPEs at €6.4 billion.
Profit on investments rose to €865 million, driven by a €653 million revaluation of life insurance joint venture stakes and €230 million in badwill from the Commerzbank equity consolidation.
These were excluded from distribution accruals, which totaled €2.5 billion for the quarter and €5.2 billion for the half year.
The fully loaded Common Equity Tier 1 (CET1) ratio stood at 16.0%, down 11 basis points from the first quarter, with €2.4 billion in organic capital generation. Risk-weighted assets increased to €287.7 billion.
The bank upgraded its 2025 guidance, forecasting net revenues above €23.5 billion, costs at or below €9.6 billion, and cost of risk around 15 basis points.
Net interest income is projected to decline by a mid-single-digit percentage from 2024, while fees and net insurance results are expected to rise by a similar margin.
Shareholder distributions are now expected to total at least €9.5 billion for the year, including a minimum of €4.75 billion in cash dividends.
An interim dividend of about €2.1 billion is planned for November, pending board approval.
Total financial assets rose 3.4% year on year to €826.7 billion. Assets under management and administration grew 14.7% to €178.2 billion. Insurance assets declined 1.4% to €57.3 billion.
The bank completed the internalisation of its Italian life bancassurance operations and increased its stake in Alpha Bank (AT:ACBr) to 20%.
It also converted part of its synthetic Commerzbank position into equity, raising voting rights to about 20%.