Italian lender UniCredit has posted a fourth-quarter profit beat, raising shareholder returns as it seeks to bolster its growth and widen the gap with competitors through strategic mergers and acquisitions (M&As). The bank’s CEO Andrea Orcel announced that UniCredit will accelerate its strategy, aiming to further improve its competitiveness.
UniCredit reported a net profit of €1.969 billion in the fourth quarter, exceeding analyst forecasts and beating expectations. Revenues reached €6 billion, slightly higher than expected. However, the lender guided for full-year revenues of above €23 billion euros in 2025, below last year’s figure, due to declining interest income.
Despite this, UniCredit remains optimistic about its prospects and targets a return on tangible equity (RoTE) performance of over 17% for 2025-27. The bank also increased its cash dividend payout guidance to 50% of net profit in 2025 from 40% in 2024.
Orcel stated that UniCredit has made significant progress toward addressing normalization pressures, including declining interest rates and costs. He expressed confidence in the bank’s ability to absorb these changes and drive growth, saying, “We’ve laid the foundation to be able to address the normalization of rates… And our ambition is to absorb all that normalization and growth.”
UniCredit has been actively pursuing M&As, with a stake build-up in Germany’s Commerzbank and a takeover offer for domestic peer Banco BPM. The bank’s CEO emphasized the importance of reviewing its offers carefully, particularly regarding Banco BPM, which aligns with UniCredit’s target segment.
The Italian government has expressed concerns over UniCredit’s aggressive bid for Commerzbank, but Orcel remains optimistic about the potential value created by combining the two banks. He stressed that UniCredit will continue to review its options and pursue strategic deals that improve its standalone case and meet strict financial and strategic requirements.
Source: https://www.cnbc.com/2025/02/11/unicredit-earnings-q4-2024.html