By Pietro Lombardi

 

UniCredit SpA posted better-than-expected results for the second quarter. Here is what you need to know:

 

NET PROFIT: Net profit for the period was 420 million euros ($498.3 million), down from EUR1.85 billion in the same period last year, when they included the sale of the bank's stake in FinecoBank SpA, the Italian bank said Thursday. Analysts had forecast a net profit of EUR335 million, according to a consensus forecast provided by the bank.

 

REVENUE: Quarterly revenue fell 7.7% on year to EUR4.17 billion, beating expectations of EUR4.12 billion.

 

WHAT WE WATCHED:

 

-PROVISIONS: In the second quarter, the bank set aside EUR937 million for credit losses, up from the EUR707 million it had stowed away a year earlier. However, this is lower than the EUR1.09 billion analysts had expected.

 

-REVENUE STREAMS: Trading income rose by almost 19% on year. Fees and commissions dropped 12% while net interest income was down 4.5%.

 

-TARGETS: The bank confirmed its profits guidance for next year. It also confirmed its guidance for a cost of risk of between 100 basis points and 120 basis points for this year. Underlying profits in the second half of this year should be in line with the first-half's, Chief Executive Jean Pierre Mustier said in a call with journalists.

 

Write to Pietro Lombardi at pietro.lombardi@dowjones.com; @pietrolombard10

 

(END) Dow Jones Newswires

August 06, 2020 04:18 ET (08:18 GMT)

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