Intesa Sanpaolo (ISP) Q2 2024 earnings summary

Executive summary

• Net income for H1 2024 reached €4.8 billion, up 12.9–13% year-over-year, marking the best half-year result since 2007 and the best-ever Q2, driven by strong revenue growth and cost discipline.

• Operating income rose 9.6–10% and operating margin increased 16.6–17% year-over-year, with cost/income ratio at a historic low of 38.3%.

• Customer financial assets surpassed €1.35 trillion, with €100–102 billion growth year-over-year.

• Shareholder returns include €3.3 billion in dividends accrued and a €1.7 billion buyback launched in June 2024.

• Significant ESG initiatives and social impact programs, including €17.2 billion in social lending since 2022 and expanded food and shelter programs.

Financial highlights

• Net interest income grew 16.2% to €7.9 billion in H1 2024; net fee and commission income up 6.9% to €4.7 billion; insurance income up 5.5% to €903 million.

• Operating margin reached €8.4 billion (+16.6% YoY); gross income up 14.7% to €7.7 billion.

• Cost/income ratio improved to 38.3% from 42% in H1 2023, reflecting effective cost management.

• Annualised cost of risk at 26bps; NPL ratio at 1.1% net and 2.2% gross, with coverage at 50.7%.

• Shareholders’ equity increased to €65.3 billion.

Outlook and guidance

• Net income guidance raised to above €8.5 billion for both 2024 and 2025, with a 70% cash payout ratio and interim dividend of around €3 billion planned.

• Net interest income for 2024 forecast at around €15.5 billion; operating costs expected to remain stable.

• CET1 ratio expected well above 14.5% pre-Basel 4 in 2025, maintaining strong capital position.

• Cost of risk expected to remain between 26 and 40 basis points.

• Additional capital distributions and share buybacks to be determined at year-end.