Mediobanca says no wealth management deal in sight as profit beats consensus

MILAN (Reuters) -Mediobanca on Wednesday ruled out the prospect of a wealth management acquisition in the immediate future, after reporting higher than expected quarterly results thanks to contributions from all its business segments.

Under Chief Executive Albert Nagel, the Italian financial services group has moved away from its traditional role as an investor in major Italian companies in favour of boosting its wealth management and consumer finance businesses.

To grow Mediobanca’s wealth management operations, Nagel in 2020 considered swapping the group’s 13% stake in insurer Generali with private banking unit Banca Generali.

He also proposed a merger to Banca Mediolanum, but neither move led to a deal.

Nagel has come under pressure from Mediobanca’s top shareholder Leonardo Del Vecchio, who has criticised Mediobanca for what he deemed an excessive reliance on the Generali stake, and has proposed governance changes at the bank.

In a post-results briefing, Nagel said Mediobanca was happy with its Generali stake, which gave “an important counter-cyclical contribution” to its balance sheet.

It would change the status quo only if a “concrete and as good option” emerged, he said, reiterating a preference for bolt-on acquisitions. At present however, “there are no files open or ongoing talks” to buy a big name in wealth management, he added.

The bank said in a statement its net profit for its fiscal third quarter stood at 190.1 million euros ($200.7 million), fractionally down from a year ago but ahead of an average analyst consensus provided by the bank of 170 million euros.

It has no material direct exposure to Russia, Ukraine and Belarus, and a small indirect exposure largely towards counterparts with a good credit rating, it said.

Only “a moderate percentange of the total loan book” is related to sectors most affected by widespread increases in prices, it said.

Mediobanca said its fully-loaded core capital ratio remained broadly stable in the quarter at 14%, after taking into account cash set aside to meet a 70% dividend payout ratio and a share buyback started in December.

A rise in the net interest margin in its consumer finance business and double-digit growth in fees from wealth management and investment banking operations lifted revenues to 688 million euros in the quarter, beating consensus of 675 million euros.

($1 = 0.9471 euros)

(Reporting by Gianluca Semeraro; Editing by Valentina Za, Keith Weir and Jan Harvey)