Among the many details in the results, the Milan-based business showed how much money its private bank and corporate and investment banking arms captured through liquidity events.

Mediobanca, the Italy-based group that has set out its private banking and wealth ambitions, on Friday reported a rise in net profit for the 12 months to 30 June, reaching €1.026 billion ($1.134 billion). The profit rose 13.2 per cent from a year earlier. 

The gain was made on the back of a 15.9 per cent year-on-year rise in total income, while operating costs rose 7.7 per cent, the bank said in a statement. Labour costs rose by 8.5 per cent. Mediobanca had a return on tangible equity, adjusted, of 13 per cent.

Loan loss provisions rose 11.3 per cent; provisions for other financial assets sunk by 80 per cent. 

The firm said that because of the “solid results”, its board intends to propose a dividend of €0.85 per share, equating to a pay-out ratio of 70 per cent, to shareholders for approval at the annual general meeting to be held in October.

The cost/income ratio for the group at the end of June was 43 per cent. It’s Common Equity Tier 1 ratio, a standard international measure of capital buffer, was 15.9 per cent, rising 30 basis points from a year earlier. 

“In FY 2022-23, the group has delivered the best results it has ever posted in terms of revenues (€3.3 billion), earnings (above €1 billion), and profitability (return on tangible equity 13 per cent), showing impressive capability to adapt to different operating scenarios and to seize business opportunities, over-delivering on the targets set versus its stakeholders, Alberto Nagel, CEO of Mediobanca, said. “On the back of this performance, Mediobanca in the next three years will deliver strong growth in wealth management, more efficient risk-weighted assets management, and enhanced shareholder remuneration, in implementation of the “One Brand – One Culture” strategic plan.”

Wealth
Within the wealth management area, Mediobanca logged double-digit growth in revenues (up 13 per cent year-on-year to €820 million) and net profit (up 21 per cent to €162 million), with a “significant resumption” in recruitment activity in the last six months, it said.

Total financial assets in the wealth arm totalled €88 billion (rising 10 per cent on a year earlier, driven by net new money of €7.3 billion. The bank said that in its private banking business, it logged growth in lending activity, with customer loans rising 10 per cent on a year ago, to €16.8 billion.

The firm said its private bank “intercepted,” alongside its corporate and investment bank, €700 million of liquidity events (such as the sale of firms, IPOs, and other events).  (Editor’s note: It is relatively unusual for a bank to spell out liquidity event data like this and Mediobanca’s transparency on this information is laudable.)

“The new market scenario has also significantly facilitated the sale of structured products. In Premier Banking, efforts to strengthen the fixed-income product offering by leveraging on group synergies have continued. In the Asset Management segment, performances have been strong, in the special situations asset class in particular,” the bank said.

The firm said it has brought in a total of 76 new recruits in the last 12 months to its private banking and wealth segment, including a six-person team from Credit Suisse. 

This publication also spoke to the head of CMB Monaco about its private banking ambitions. CMB is part of the Mediobanca group.