Market Commentary and Intraday News

Intesa Q2 earnings beat expectations

294 days ago

(AP:MILAN) Italian bank Intesa SanPaolo felt the impact of the Europe's financial crisis during the second quarter as it reported a 36 percent fall in net profits..

Nonetheless the bank beat analyst expectations with (EURO)470 million ($574 million) net profit against (EURO)741 million in the same quarter of 2011. Analysts were expecting net profit of (EURO)307 million, according to financial data provider FactSet.

Intesa shares rose as much as 7.3 percent to top (EURO)1 in Milan trading, before dropping to (EURO)0.998.

Second-quarter operating income was down 8.5 percent to (EURO)4.13 billion, as the bank reported lower trading profits and higher loan adjustments.

Trading profits were (EURO)161 million, which included a (EURO)94 million gain from the sale of a stake in the London Stock Exchange. That was down from (EURO)541 million in the same period of 2011, mostly derived from the sale of stakes in luxury goods maker Prada and consumer credit bank Findomestic.

For the first six months of the year, earnings were down 9 percent to (EURO)1.27 billion.

CEO Enrico Cucchiani said in a statement that he is satisfied with the half-year results, noting high liquidity, strong capital ratios and robust provisions against risky loans `'reflect a prudent and conservative strategy."

The bank's Core Tier 1 ratio, a key measure of a bank's health, was 10.7 percent, up from 10.1 percent at the end of 2011. Loan loss provisions were (EURO)2.1 billion, up 37 percent from the first half of 2011 with a 20 percent increase in new, risky loans.

`'Our bank is well positioned to support the economic development of the country and to offer a safe and trustworthy haven for Italian's savings," Cucchiani said.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

View all of today's news »