The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Noemi Peruch - Mediobanca - Banca di credito finanziario S.p.A., Research Division - Analyst
: I have a few. The first one is a clarification on cost. You mentioned, indeed, EUR 60 million of positive one-off in Q3 and lower variable compensation.
Can you specify the size of the one-off? Is that EUR 40 million, so with a variable compensation of EUR 20 million, in line with Q2?
And the second one is on asset quality. On the EUR 1.2 billion UTP disposal, what is the average yield attached to these portfolios?
And the last one is on common equity. What drives the quarterly reduction in RWA? Is it the switch from drawing line to state guaranteed loans?
And do the 50 bps regulatory headwinds include the positive from lower software deduction?
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NOVEMBER 05, 2020 / 5:30PM, BAMI.MI - Q3 2020 Banco BPM SpA Earnings Call
Question: Noemi Peruch - Mediobanca - Banca di credito finanziario S.p.A., Research Division - Analyst
: Asset quality.
Question: Noemi Peruch - Mediobanca - Banca di credito finanziario S.p.A., Research Division - Analyst
: Yes. Yes.
Question: Noemi Peruch - Mediobanca - Banca di credito finanziario S.p.A., Research Division - Analyst
: And just to make sure I understand, the NII contribution is 15 or 50?
Question: Domenico Santoro - HSBC, Research Division - Analyst
: A couple of questions also on my side very quickly. First of all, on this UTP portfolio that my understanding has been already sold. I see it's mainly
real estate. So I assume is highly collateralized. So just wonder whether you can give us an idea of the coverage on this. I see that you have done
a top-up, of course, ahead of the sale and to understand whether we should expect a drop in the coverage or not?
The other question is on the regulatory headwinds. This 50 bps that you're mentioning coming in Q4, is this -- was it already included in the 200
basis points guidance that you gave back in March? Or is something that we should consider on top of that?
And then given that -- I mean, there were other questions about the M&A. I'm just wondering whether I can use your brain on this. We have seen
recently in all the M&A been announced so far in 2020, in Italy, in Spain, there was a big chunk of provisioning or 2-partner coverage from very
solid banks and filtering, of course, into the capital. So I mean you said that you are quite open to discuss with -- I mean, with other partners, so
you're open to M&A. Is it something that the regulator, regardless of COVID, is asking in a way? And I don't know whether you want to answer to
this question, but alternatively, what would be the minimum level of capital that you would accept in a M&A transaction?
Question: Domenico Santoro - HSBC, Research Division - Analyst
: Sorry, the 10, 15, if my understanding is correct, impact from the sales, what is it? Is it the additional provision that you have done in Q3 or is
something that should come in Q4? And if it is negative or positive?
Question: Domenico Santoro - HSBC, Research Division - Analyst
: Yes, correct.
Question: Hugo Moniz Marques Da Cruz - Keefe, Bruyette & Woods Limited, Research Division - Analyst
: Just sorry to insist on the headwinds. I just wanted to clarify what you said about headwinds in 2021. Is it going to be 50 basis points because you
are front-loading something this year? Or is it going to be 100 basis points? And then I understand that was before any potential benefit from the
waiver for large NPL sales. Do you have any visibility now on whether you can benefit from that wave or not? That's it.
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