Italy's Mediobanca (MDBI.MI) beat quarterly revenue and profit expectations, pointing to a bigger than expected increase in fee income as a diversified business model helped it ride out economic and market turmoil.
Chief Executive Alberto Nagel told a press briefing on Friday that the bank continues to look for acquisition opportunities, favouring bolt-on deals with "limited execution risk", such as those in the "buy now, pay later" sector.
Opportunities could also arise in wealth management given the current challenging macroeconomic backdrop as businesses which would not be sold in what he termed a "standard scenario" may now be put on the block.
Nagel has previously considered buying Generali's (GASI.MI) private banking unit Banca Generali (BGN.MI) and merging with Banca Mediolanum (BMED.MI), although no deals materialised.
Mediobanca, which alongside wealth management offers consumer finance and corporate and investment banking services, posted a net profit of 191 million euros ($194.92 million) in the fourth quarter of its fiscal year to June 30, above an analyst consensus provided by the bank of 175 million euros.
Revenue of 704 million euros also beat expectations with a rise in fee income to 205 million euros topping a consensus forecast of 190 million euros.
"Contrary to expectations, fee income, which is all recurring, increased 2% Q/Q and beat consensus", Autonomous analysts said.
Mediobanca's board proposed a dividend of 0.75 euros per share, equal to a cash payout of 70%, which Nagel said would be maintained next year as he confirmed all the targets of the bank's strategic plan.
The bank said its "highly resilient" business model, including consumer finance and insurance segments which are less influenced by GDP trends, can mitigate the impact on revenue from any further macroeconomic deterioration.
"It is important that there is no dislocation that lasts for many quarters, but Mediobanca does not rely on positive scenarios to perform well", Nagel said.
The bank's core capital ratio of 14.5% remained one of the highest in Italy.
