Full Year 2024 Banco BPM SpA Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Pamela Zuluaga - Morgan Stanley - Analyst : Hello. Good morning. Thank you very much. The first question that I have is specifically on your Q4 results for insurance. There was a sharp quarter-on-quarter decline. Can you give us some color around what were the moving pieces for insurance income in the quarter? And what are the main drivers that you expect for this line to grow moving forward? And the other one is a follow-up on your distribution targets. I understand that you will assess the distribution mix for the 80% accrual. But what about the potential additional EUR1 billion distribution? Are you open to it being distributed via buybacks? Thank you.

Question: Pamela Zuluaga - Morgan Stanley - Analyst : Very clear. Thank you.

Question: Ignacio Ulargui - Exane BNP Paribas - Analyst : Thanks very much on the presentation and the details. Just wanted to get a bit of your thoughts on -- when I just look to the NII of 2026 that you provide in the press release of the plan, it looks like there is an incremental decline in '26 versus '25. So I just wanted to get a bit of your thoughts on what are the moving parts on that decline in NII. And the second question that I just wanted is how relevant volumes can be in improving the performance of the top line in '25 and '26. Have you seen any kind of acceleration of lending growth, some signs that provide some comfort on a recovery of volumes? Thank you.

Question: Ignacio Ulargui - Exane BNP Paribas - Analyst : Thank you.

Question: Noemi Peruch - Mediobanca Group - Analyst : Good morning. Thank you for taking my question. I have a few on the Danish Compromise. And I would like to know the day one impact of the acquisition of Anima without the Danish Compromise and if this would not impact the 80% payout on earnings in 2025. And I was wondering if you could give us a little bit of color on this decision, whether it is a matter of timing, considering the tender offer ongoing, or if it is a matter of skepticism maybe you sensed from the supervisor. And then on NII guidance. I think you mentioned mid-single digit, down for 2025. I was just wondering if this is a full funding cost or is it NII as it

Question: Noemi Peruch - Mediobanca Group - Analyst : Thank you.

Question: Adele Palamß - UBS Group AG - Analyst : Yes. Hi.I have a few questions on the fee and the AuM growth, so in the plan. So can you tell us a little bit about the -- how you see the fee margin evolution and which type of market performance you are embedding in your fee forecast -- in the forecast of the AuM? And then, sorry, can you repeat the impact of the Danish -- of the -- if you don't apply Danish Compromise to Anima, it's around 200 basis points, you said. Then I would like to know if you have any DTA of balance sheet, I mean, you probably have, if you can tell us the amount. And then one general question, more around M&A. I mean, how do you think about inorganic growth opportunity for BAMI at this point?

Question: Adele Palamß - UBS Group AG - Analyst : Above -- on the market performance expected into the forecast and on the margin -- on the management fee margin evolution, how you see it.

Question: Adele Palamß - UBS Group AG - Analyst : Okay, thanks.

Question: Andrea Lisi - Equita - Analyst : Yeah, hi. Thank you for taking my question. The first one is if you can provide us an indication of upfront fees in the fourth quarter 2024 and, in general, over the full year. And what is the level of upfront fees that you are assuming in the plan obviously for the Banco BPM standalone and combined with Anima? And in slide 31, you have pointed out the EUR80 million increase in revenues from associates. Can you provide some detail on that? And really, just a clarification on the evolution of the NII. Can -- have I understood correctly that the increase of 5% of NII in 2027 versus 2026 is not driven by volumes or by margin apart by volumes and mostly by managerial actions that you are planning to put in place? And which are these? If you can provide some further details on these managerial actions. Thank you.

Question: Andrea Lisi - Equita - Analyst : Thank you.

Question: Delphine Lee - JPMorgan Chase & Co - Analyst : Hi. Good morning. Thanks for taking my question. Just a very few quick clarification. Just on NII, a follow-up on what you've just said. Is your assumption on the replicating portfolio to still increase that eventually towards EUR25 billion or EUR30 billion? And would it be possible to have the sort of rate the -- of what is maturing on your replicating portfolio in lower rates just to kind of assess how much of an uplift we can get during your plan? And then on buybacks, would you start -- just about the timing of that. Would you start that, I would assume, after the Anima offer? Would you ask the authorization for that as soon as you get the Danish Compromise? And also maybe, just when do you think you get clarity on the Danish Compromise? Is that March or could that be later? Thank you.

Question: Delphine Lee - JPMorgan Chase & Co - Analyst : And the Danish Compromise is March, you would say or could be later?

Question: Delphine Lee - JPMorgan Chase & Co - Analyst : Great. Thanks very much.

Question: Manuela Meroni - Intesa Sanpaolo - Analyst : Good morning and thank you for taking my qeustions. The first one is on the loan evolution. I'm wondering if you can comment on the trend of loans in the fourth quarter and what do you expect in 2025. The second question is on the regulatory headwinds at page 35, 94 basis points. This is just related to the Basel IV. Or there are some other elements we should take into consideration? And what is the phasing that you had assumed in your business plan? Third question on the sensitivity to rates. I'm wondering if you have further room to reduce the sensitivity. I imagine that you have. And finally, on the DTA. What are the DTA that are remaining in your balance sheet after 2027?

Question: Hugo Cruz - Keefe, Bruyette & Woods Inc - Analyst : Hi. Thank you for the time. It's related to that DTA effect and OCI effect in your capital waterfall. Quite big numbers. I was wondering if you could clarify a bit the timing of those positive impacts, like in each year. Thank you.

Question: Hugo Cruz - Keefe, Bruyette & Woods Inc - Analyst : Thank you. Very helpful.

Question: Marco Nicolai - Jefferies Group LLC - Analyst : Hi. Thanks for taking my question. So my understanding is that the amendment of the Anima offer consideration allows also UniCredit to terminate their offer of Banco BPM. I don't know if you want to -- if you have any color on the Anima offer consideration allows also UniCredit to terminate their offer of Banco BPM. I don't know if you want to -- if you have any color on this or -- any reason to believe the UniCredit instead will not exercise this condition. Thank you.

Question: Marco Nicolai - Jefferies Group LLC - Analyst : Thank you.

Question: Luis Pratas - Autonomous Research - Analyst : Thank you very much for taking my question.I have the first one on the Danish Compromise again, sorry. Could you please give any color regarding your interactions with regulators on this subject? You seem to be a bit more cautious regarding the timing. So I'm basically trying to assess what is the risk of not receiving the Danish Compromise altogether. And secondly, could you also provide a bit more color on the cost development throughout the business plan, how much you expect for cost, for instance, next year. And do the EUR100 million benefit from exits, does this come equally throughout the years? Or it's going to be more front-loaded next year or like more closer to the end of the business plan? Thank you.

Question: Luis Pratas - Autonomous Research - Analyst : Thank you.