Top Stories
Shares in Italy’s Intesa rise after reassurances on capital, paybacks
Global Banking & Finance Review®
Company
MILAN (Reuters) – Shares in Intesa Sanpaolo rose 3% in early trade on Monday after Italy’s top bank reassured investors on its capital buffers and ability to reward investors as planned, despite supervisory concerns over internal models to assess risks.
MILAN (Reuters) – Shares in Intesa Sanpaolo rose 3% in early trade on Monday after Italy’s top bank reassured investors on its capital buffers and ability to reward investors as planned, despite supervisory concerns over internal models to assess risks.
Intesa said late on Friday it would end the year with a core capital ratio of around 13% – from 12.4% at the end of September – and stay above the bank’s target of more than 12% through 2025.
That takes into account all the expected regulatory hits and a 1.7 billion euro ($1.85 billion) share buyback the bank has put on hold until the approval of full-year results, despite receiving a green light from the European Central Bank.
“We expect this to reassure the market on the group’s capital position and the effort to optimise it, and expect the group to continue on its generous capital return,” Citi analysts said.
Intesa shares fell on Friday after a Bloomberg report the bank was shedding as much as 20 billion euros in assets after the ECB took aim at its risk models, demanding higher weighting for loans.
Traders said investors worried about the bank’s ability to put through its generous capital distribution plans.
Intesa said it would reduce risk-weighted assets in the fourth quarter because of regulatory changes starting January.
($1 = 0.9175 euros)
(Reporting by Valentina Za, editing Federico Maccioni and Louise Heavens)
Equity refers to the ownership interest in a company, represented by shares of stock. It signifies the value of an owner's stake in the business after all liabilities have been deducted.
Capital is the financial resources or assets that a company uses to fund its operations and growth. It can come in the form of equity, debt, or retained earnings.
Risk management involves identifying, assessing, and prioritizing risks followed by coordinated efforts to minimize, monitor, and control the probability or impact of unfortunate events.
Financial markets are platforms where buyers and sellers engage in the trade of assets such as stocks, bonds, currencies, and derivatives. They facilitate the flow of capital and liquidity in the economy.
A share buyback occurs when a company purchases its own shares from the marketplace, reducing the number of outstanding shares. This can increase the value of remaining shares and improve financial ratios.
Explore more articles in the Top Stories category
