PRESS RELEASE. Number of branches 1,192 1, Number of employees 11,427 11,

Transcription

1 BANCA POPOLARE DELL EMILIA ROMAGNA Società Cooperativa Head Office: Via San Carlo 8/20, Modena Banca Popolare dell Emilia Romagna Banking Group no PRESS RELEASE Half-year report as of 30 June 2007 approved AN EXCELLENT FIRST HALF OF THE YEAR FOR THE BPER GROUP: - Cost/income ratio reduced by more than six points; down to 50.6%; - Net income for the period up by almost 26%. Summary figures of the BPER Group at 30 June 2007 with comparatives: in millions of Euro 30/6/ /12/2006 Change Balance sheet - Direct customer deposits 38, , % - Indirect deposits 27, , % - Customer funds under management 66, , % - Loans and advances to customers 33, , % - Shareholders' equity (including net income) 2, , % Number of branches 1,192 1, Number of employees 11,427 11, /6/ /6/2006 Change Income statement - Net interest income % - Net interest and other banking income % - Net income from financial activities % - Operating costs (481.4) (494.1) % - Profit from current operations before income taxes % - Net income for the period % - Net income attributable to the Parent Bank % - Cost/income ratio 50.61% 56.74% b.p. The Board of Directors of Banca Popolare dell Emilia Romagna met late yesterday afternoon to review and approve the half-year report of the BPER Group as at 30 June Consolidated net income of the BPER Group amounts to million, an increase of 25.78% on the first half of the previous year. The net income attributable to the Parent Bank, net of minority interests, comes to all of million, %.

2 This excellent result has been achieved thanks to the reduction in operating costs and the good growth in net interest income, which rose by 17.43%, also because of the expansion in loans to customers of more than 7.2% year-on-year. The following are the key balance sheet figures, compared with the 2006 annual consolidated financial statements and with the situation at 30 June The income statement comparisons are made on a consistent basis with reference to the figures for the first half of Deposits: direct customer deposits, of 38,582.9 million, are 3.26% up on the end of 2006, and 6.75% up on June These growth figures are partly due to the increase in medium-term funding and bonds (+4.4%), and partly to that of short-term deposits, particularly certificates of deposit (+5.62%) and repos (+16.9%); indirect customer deposits amount to 27,749.6 million; there has been an increase of 2.16% compared with last December and one of 8.64% compared with June The balance is positive both in the managed component (+1.26%), and in the administered one (+2.76%); total customer funds administered by the Group exceed 66,332 million (+2.80% in the six months and +7.53% compared with the end of June 2006). Loans: loans to customers, net of writedowns, are shown in the balance sheet for a total of 33,535.7 million (+7.23% on last December and % on June 2006). Of this figure, the proportion of nonperforming loans comes to 1.46%, amounting to only million (+4.38% on December 2006). Equity: consolidated equity pertaining to the Group, including net income for the period, comes to 2,920.7 million; it is slightly down on the end of last year (-1.08%); whereas it is up by 16.57% on June Adding minority interests of million, total consolidated equity comes to 3,825.6 million (+13.34% on June 2006). Income statement: net interest income of million (+17.43%); net commission income of million (-5.40%); the decline is essentially due to the loss of commission income on the tax collection business transferred to Riscossioni s.p.a. (now Equitalia SpA). Net of this component, there has been an increase in commission income in the first half of 2007 of just over 3%. income from banking activities comes to million (+9.23%); writedowns for impairment of loans, net of writebacks, amount to 65.3 million (+36.62%); net interest and other banking income comes to million (+7.64%); administrative costs have been reduced to million (- 0.50%); of these, million relate to personnel costs (-3.31%). The net decrease in expenses is partly due to the deconsolidation of the two tax collection companies (Ritrimat s.p.a. and Bipiesse Riscossioni s.p.a.), whose costs amounted to around 19 million. There has also been a reduction in the provisions made for termination indemnities, which have been recalculated in actuarial terms to reflect the recent changes in the rules on supplementary pensions (resulting in a benefit of 19.7 million); operating costs, net of operating income, come to million (-2.58%); these costs as a proportion of net interest and other banking income, give a cost/income ratio of 50.61% (56.74% at the end of June 2006). The profit from ordinary operations amounts to million (+22.54%). After deducting income taxes of million, net income for the period comes to million ( million at 30 June 2006, %).

3 Net income attributable to the Parent Bank amounts to million (+18.60%); minority interests account for 54.9 million (+60.84%). The thirteen banks making up the Group have a presence in sixteen Italian regions, as well as in the Grand Duchy of Luxembourg, with a total of 1,192 branches, including 11 opened in the first half of The Group now employs 11,427 people (221 more than at the end of 2006 and 212 fewer than in June 2006). Banca Popolare dell Emilia Romagna (Parent Bank) The half-year results of the Bank at 30 June 2007, which were also approved by the Board of Directors, shows the following balance sheet and income statement figures (the former compared with the 2006 annual financial statements and the latter with those of the report at 30 June 2006): direct deposits, 14,973 million (+4.88%); indirect customer deposits of 17,687.6 million (+3.02%); total customers' funds under management, 32,660.6 million (+3.87%); loans to customers of 14,738.3 million (up 8.57%), of which just 0.89% ( million) are net non-performing positions; shareholders' equity, including net income for the period, comes to 2,459.5 million (-2.90% on 31 December 2006 and % on 30 June 2006); The income statement shows: net interest income of million (up 21.32%); net commission income of 99.3 million (+3.05%); income from banking activities of million (+ 8.90%); net result from financial management of million (+5.25%); operating costs (net of operating income) of million (+1.12%), including administrative expenses of million (+ 5.20%). The cost/income ratio comes to 40.40% (43.51% at 30 June 2006). Pre-tax income for the period comes to million, compared with million in June 2006 (+ 8.75%). Net income for the period - less income taxes of 58.8 million (+9.45%) - amounts to million (+8.44%). The auditors are still carrying out their review and the half-year report as of 30 June 2007 will be made available before the legal deadline. Subprime mortgages *************************************************** With Communication no of 30 August, CONSOB asked listed banks and insurance companies to provide information and comments on any holdings they might have in subprime mortgages or in any financial products derived from or linked to such loans.

4 In this regard, we hereby declare that neither the Bank nor any BPER Group company has investments or commitments in this segment. Similarly, we do not hold any investments in instruments and/or products of third parties that might be related to this segment. Nor does any BPER Group company have on deposit or under administration any financial investments in securities of this kind belonging to our customers. Nor is there any evidence that third parties providing the Group with custodian or management services hold financial products with underlying assets of this kind. Operations in derivatives With a communication sent last August, the Bank of Italy asked banks to carry out a detailed selfevaluation of their operations in derivatives. Having carried out this analysis, we can state the following: our operations in derivatives on own account are very limited. They have never grown to a size that could be considered inconsistent with the volumes that we handle; derivatives have only ever been used to hedge exchange and interest risk. There would not therefore appear to any particular risk in this area, even with regard to counterparty risk, as all such transactions are with prime international financial institutions; the volume of transactions in unlisted derivatives is practically insignificant, being limited both in terms of notional values and in terms of effective counterparty risk. The transactions carried out and still outstanding feature a low or zero level of complexity (in terms of compound financial instruments). Valued on the basis of the current market context, they represent an effective way of hedging exchange and interest risk, entirely in line with the requests made by our customers. Modena, 18 September 2007 References: Managing Director Guido Leoni Contacts: General Affairs Department Ermete Benatti Tel fax ermete.benatti@bper.it Accounting Emilio Annovi Tel fax emilio.annovi@bper.it International Relations & Investment Research Marco Righi Nicli Tel fax marco.righinicli@bper.it Gabriele Ugolini Tel fax gabriele.ugolini@bper.it

5 Assets Change % Change 10.Cash and balances with central banks 304, ,833 (66,544) Financial assets held for trading 5,056,909 4,373, , Financial assets at fair value 1,182,012 1,316,622 (134,610) Financial assets available for sale 1,248,724 1,432,489 (183,765) Due from banks 2,970,552 3,900,048 (929,496) Loans to customers 33,535,746 31,274,014 2,261, Equity investments 363, , , Property, plant and equipment 920, ,880 1, Intangible assets 253, ,873 (215) of which: goodwill 238, ,905 (1,969) Tax assets 347, ,892 (98,232) a) current 128, ,065 (102,207) b) deferred 218, ,827 3, Non-current assets and disposal groups held for sale 13,187 13,643 (456) Other assets 753, ,081 41, Total assets 46,950,580 45,257,632 1,692, Equity and liabilities Change % Change 10.Due to banks 2,114,347 1,729, , Due to customers 26,132,069 25,482, , Debt securities in issue 11,252,846 10,504, , Financial liabilities held for trading 225, ,690 25, Financial liabilities at fair value 1,197,982 1,377,862 (179,880) Tax liabilities 245, ,174 (129,570) a) current 181, ,382 (117,473) b) deferred 63,695 75,792 (12,097) Other liabilities 1,385,191 1,151, , Provision for termination indemnities 232, ,029 (38,047) Provisions for risks and charges: 338, ,537 11, a) pensions and similar commitments 165, ,416 5, b) other provisions 173, ,121 5, Revaluation reserves 300, ,391 (147,901) Equity instruments 23,367 24,121 (754) Reserves 1,346,822 1,101, , Share premium reserve 335, ,010 18, Share 190. capital 755, ,433 5, Treasury shares (38,167) (34,829) (3,338) Equity pertaining to minority interests 904, ,343 19, Net income (loss) for the period 197, ,831 (149,043) Total equity and liabilities 46,950,580 45,257,632 1,692,

6 Captions Change % Change 10.Interest and similar income 1,165, , , Interest and similar expense (448,940) (310,128) (138,812) Net interest income 716, , , Commission income 244, ,214 (15,544) Commission expense (24,912) (27,916) 3, Net commission income 219, ,298 (12,540) Dividends and similar income 17,007 17,519 (512) Net trading income (35,857) (26,293) (9,564) Gains/losses on disposal or repurchase of: 28,794 43,881 (15,087) a) loans and advances - 54 (54) b) financial assets available for sale 30,656 43,533 (12,877) d) financial liabilities (1,862) 294 (2,156) Net change in value of financial liabilities at fair value 4,695 (6,992) 11, Net interest and other banking income 951, ,836 80, Net impairment adjustments on: (65,322) (47,814) (17,508) a) loans and advances (64,376) (47,513) (16,863) b) financial assets available for sale (12) (71) d) other financial assets (934) (230) (704) Net income from financial activities 885, ,022 62, Administrative costs: (531,350) (534,006) 2, a) payroll (320,219) (331,190) 10, b) other administrative costs (211,131) (202,816) (8,315) Net allowances for risks and charges (17,040) (15,543) (1,497) Net adjustments to property, plant and equipment (19,053) (19,290) Net adjustments to intangible assets (3,030) (2,942) (88) Other operating charges/income 89,098 77,643 11, Operating costs (481,375) (494,138) 12, Share of results of subsidiaries and associates 5,924 7,177 (1,253) Adjustments to goodwill (414) (812) Gains (losses) on disposal of investments Profit (loss) from current operations before tax 410, ,272 75, Income taxes on current operations (158,127) (134,345) (23,782) Profit (loss) from current operations after tax 252, ,927 51, Net income (loss) for the period 252, ,927 51, Net income (loss) pertaining to minority interests (54,940) (34,159) (20,781) Net income (loss) pertaining to the Parent Bank 197, ,768 31, Cost/income ratio 50.61% 56.74% -6.13%

7 Assets Change % Change 10.Cash and balances with central banks 72,729 77,305 (4,576) Financial assets held for trading 2,243,460 2,176,287 67, Financial assets at fair value 321, ,920 (32,941) Financial assets available for sale 157, ,784 (176,397) Due from banks 2,804,026 3,567,048 (763,022) Loans to customers 14,738,323 13,574,471 1,163, Equity investments 2,461,624 2,349, , Property, plant and equipment 203, ,226 (771) Intangible assets 9,484 9, Tax assets: 122, ,774 (26,619) a) current 78, ,683 (28,655) b) deferred 44,127 42,091 2, Other assets 388, ,315 38, Total assets 23,523,530 23,146, , Equity and liabilities Change % Change 10.Due to banks 4,987,864 5,371,607 (383,743) Due to customers 9,127,706 8,586, , Debt securities in issue 5,189,864 4,958, , Financial liabilities held for trading 131, ,795 10, Financial liabilities at fair value 655, ,059 (75,656) Tax liabilities: 137, ,851 (24,484) a) current 115, ,875 (11,836) b) deferred 22,328 34,976 (12,648) Other liabilities 565, , , Provision for termination indemnities 59,506 69,270 (9,764) Provisions for risks and charges: 208, ,111 9, a) pensions and similar commitments 154, ,699 7, b) other provisions 54,172 51,412 2, Revaluation reserves 67, ,432 (128,709) Equity instruments 22,142 22,278 (136) Reserves 1,183,203 1,062, , Share premium reserve 335, ,010 18, Share 180. capital 755, ,433 5, Treasury shares (38,142) (34,805) (3,337) Net income (loss) for the period 134, ,477 (86,319) Total equity and liabilities 23,523,530 23,146, ,

8 Captions Change % Change 10.Interest and similar income 499, , , Interest and similar expense (265,751) (179,664) (86,087) Net interest income 233, ,573 41, Commission income 114, ,207 2, Commission expense (15,623) (15,831) Net commission income 99,316 96,376 2, Dividends and similar income 61,159 52,055 9, Net trading income (17,878) (18,336) Gains/losses on disposal or repurchase of: (1,956) 25,492 (27,448) - a) loans and advances - 54 (54) b) financial assets available for sale ,292 (24,622) - d) financial liabilities (2,626) 146 (2,772) Net change in value of financial liabilities at fair value 5, , Net interest and other banking income 379, ,520 31, Net impairment adjustments on: (33,227) (19,486) (13,741) a) loans and advances (32,880) (18,944) (13,936) b) financial assets available for sale d) other financial assets (347) (542) Net income from financial activities 346, ,034 17, Administrative costs: (192,717) (183,186) (9,531) 5.20 a) payroll (110,053) (106,539) (3,514) 3.30 b) other administrative costs (82,664) (76,647) (6,017) Net allowances for risks and charges (2,251) (4,179) 1, Net adjustments to property, plant and equipment (4,942) (5,361) Net adjustments to intangible assets (2,340) (2,218) (122) Other operating charges/income 48,909 43,298 5, Operating costs (153,341) (151,646) (1,695) Share of results of subsidiaries and associates (9) - (9) Gains (losses) on disposal of investments (48) 20 (68) Profit (loss) from current operations before tax 192, ,408 15, Income taxes on current operations (58,765) (53,692) (5,073) Profit (loss) from current operations after tax 134, ,716 10, Net income (loss) for the period 134, ,716 10, Cost/income ratio 40.40% 43.51% -3.11% ******