The sector publications, including Il Sole 24 Ore, give ample space to the new research by Excellence Consulting in which it is highlighted how the network banks are able to withstand the great interest rate shock, still recording growing profits.
In 2022, the war in Europe and record inflation prompted the ECB to raise interest rates (BTPs have reached almost 10% and we need to go back to 2015 to have yields of over 3.5%), at which is matched by the negative performance of the financial markets, with the strong depreciation of both the equity and bond segments. On the one hand, as expected, the revenues of the top five commercial banks (Intesa Sanpaolo, Unicredit, Banco BPM, BPER, MPS) increased due to higher interest margins, reaching almost 44 billion euros, well over 41 .4 of 2015, with a growth rate of 8.1% from 2021 to 2022, while the compound annual growth rate, from 2015 to 2022, remains low, at around 0.9%. On the other hand, the revenues of the top five networks (Fideuram, Mediolanum, Fineco, Banca Generali, Allianz Bank), surprisingly, hold up well and even rise from 2021 to 2022 by about 0.9%, from 5.56 billion in 2021 to 5.61, with in this case the compound annual growth rate, from 2015 to 2022, which is confirmed at high levels, in the order of around 6.7%. This was stated by a research by Excellence Consulting, which analyzes the trend of core revenues (interest margin plus net commissions, net of extraordinary revenue components) in the last seven years, from 2015 to 2022, of the top five banks both among commercial that networks.
In detail of the study, regarding the commercial ones (Intesa Sanpaolo, Unicredit, Banco BPM, BPER, MPS), core revenues went from 41.41 billion in 2015 to 39.24 (2016), 38.09 (2017), 40, 10 (2018), 37.86 (2019), 37.82 (2020), 40.70 (2021) up to 43.98 in 2022. The ability that commercial banks have demonstrated to contain the loss of revenues on net commissions, maintaining a level of revenues around 18.4 billion, they were 15.8 in 2015. The loss between 2021 and 2022 is substantially limited, only 3.6%, also thanks to a incidence of indirect deposits on total for commercial banks still limited, around 42%.
As for the five networks covered by the work (Fideuram, Mediolanum, Fineco, Banca Generali, Allianz Bank), core revenues range from 3.57 billion (2015) to 3.76 (2016), 4.07 (2017), 4, 08 (2018), 4.83 (2019), 4.70 (2020), 5.56 (2021), 5.61 (2022). It should be noted that these results were created in a context where the networks managed to compensate for a reduction in net commissions of over 10% (from 4.70 billion in 21 to 4.22 in 22), due to a greater incidence for them of indirect deposits on total deposits equal to over 82%, through a more than proportional increase in the interest margin from 0.86 billion in 21 to 1.39 in 22.
Lastly, for the Networks, the continuous growth of the customer base should also be highlighted, which in 2022 will reach around four million customers in total, still far from the figure of over 47 million customers of commercial banks, but with a compound annual growth rate which for networks from 2015 to 2022 remains positive and equal to over 4%, while for commercial banks, despite the trend reversal marked in 2022 (+3.2%), it is confirmed as negative in the order of -2, 3%.
“The expansion of commercial bank revenues – says Maurizio Primanni, CEO of Excellence Consulting, in the light of the fact that in the years taken into consideration by the study there have been unification processes, from the acquisition of UBI by intesa Sanpaolo and BPER and that of Carige by BPER to mention the last two, is significant but not such as to change the view on the strategic needs of the commercial banking system. In fact, the growth in revenues is mainly due to the increase in the interest margin, which in 2022 (25.6 billion) returns to the levels of 2015 (25.57 billion), and is therefore directly correlated with the trend in interest rates interest that is expected to realign downwards in the medium term.”
The data from the networks – explains Prianni – was determined by the ability they demonstrated to be able to improve the component of revenues from interest margin, which between 2021 and 2022 increased by over 60%, from 0.86 billion to 1 .39 (+0.53%). This growth more than compensated for the loss of revenues that the networks recorded in the net fee and commission component, which was influenced by the poor performance of the financial markets and which already in the short term, in the hypothesis of restarting the recovery phase of the markets, could register a trend reversal. Lastly, it should be noted that the increase in interest rates also allowed the commercial banks to reverse the trend in the evolution of the customer base, which grew by 3.2% from the 21st to the 22nd, while maintaining a compound annual growth rate between 15 and 22 which remains negative. Conversely, the customer base of the network banks shows a stable trend of customer growth in the order of around 4% per year, with the customers of the top five rising from three to four million between 2015 and 2022.”