MILAN (Reuters) - Italy's Banco BPM (LON:0RLA) met its 2023 net profit goal on Thursday as higher interest rates boosted earnings in the last quarter of the year, and more than doubled its dividend per share compared with 2022.
Italy's third-largest bank reported a net profit of 1.26 billion euros for 2023, up 84.6% from the previous year thanks to rising revenues and falling loan loss provisions, which more than offset increasing costs.
Banco BPM, whose leading shareholder and main commercial partner is French bank Credit Agricole (EPA:CAGR), confirmed a 2024 profit guidance of 90 euros cents per share net of non-recurring items, up from above 80 euro cents last year.
In the October-December period, net profit totalled 321 million euros, surpassing a 285 million euro analyst consensus compiled by Reuters.
Income from lending grew by a fifth in the period from a year before, though it was virtually flat quarter-on-quarter.
With its roots in Italy's wealthy Lombardy region, Banco BPM has been seen as a potential merger partner for state-owned Monte dei Paschi or peer BPER Banca, as well as a possible takeover target for larger rival UniCredit (LON:0RLS).
Like peers, which have boosted shareholder remuneration as profits surged, Banco BPM said it planned to pay out 56 euro cents per share out of its 2023 earnings, up from a cash dividend of 23 euro cents a share over 2022 results.
Under a strategic plan unveiled in December, the bank plans to return 4 billion euros to investors by 2026, equivalent to more than 50% of its market capitalisation.