UniCredit to Book Additional EUR900 Million Loan Loss Provisions in 1Q
April 22 2020 - 2:30AM
Dow Jones News
By Mauro Orru
UniCredit SpA said Wednesday that it would take an additional
900 million euros ($976 million) in generic loan loss provisions in
the first quarter of 2020 as it anticipates the IFRS9 macroeconomic
scenario update.
The Italian bank said it expects a 13% fall in eurozone gross
domestic product for 2020, with a 10% recovery in 2021, assumptions
which include the projected impact of the coronavirus pandemic.
UniCredit said cost of risk for the first quarter is projected
around 110 basis points, with 80 basis due to the updated IFRS9
scenario.
Cost of risk for 2020 is expected to be in a range of 100 basis
points and 120 basis points, the lender said, projecting a range of
70 basis points and 90 basis points for 2021.
The announcement comes as Chief Executive Jean Pierre Mustier
proposed a 25% reduction to his own 2020 salary, renouncing his
full variable remuneration for the year.
UniCredit said it has a "strong liquidity position", with a
liquidity coverage ratio above 140% at the end of the first
quarter.
Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94
(END) Dow Jones Newswires
April 22, 2020 02:15 ET (06:15 GMT)
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