UniCredit bank profits jump amid Italian economic recovery
MILAN (AP) — Italian bank UniCredit says its second-quarter profit jumped 30 percent as provisions for bad loans dropped amid a recovery in Italy's economy.
UniCredit reported net profit of 522 million euros ($568 million) for the three months ended June 30 against 403 million euros in the same period of 2014. Revenue was flat at 5.7 billion euros.
CEO Federico Ghizzoni called the first-half profit, which exceeded 1 billion euros, "an excellent result" in an unfavorable banking environment with interest rates at historic lows.
Ghizzoni also announced the biggest management shuffle since he took over the bank five years ago, with the departure of general manager Roberto Nicastro, who has been key in refocusing the group's business and developing digital banking. UniCredit cited "a respectful divergence of opinions" on strategy and organization.
Ghizzoni told analysts that Nicastro's resignation, effective Oct. 1, will allow a simplification of the managerial organization.
The bank said the percentage of impaired loans fell 9 percent to 913 billion euros. Meanwhile, the bank's Tier 1 ratio, a key measure of financial health, rose to 10.4 percent.
The results "confirm the validity of our strategy and our continuous de-risking effort," Ghizzoni told analysts.
Shares in UniCredit SpA were up 5.7 percent to 6.32 euros.