By Ed Frankl 
 

Intesa Sanpaolo SpA said Friday that net profit dropped on year but beat expectations, boosted by higher net interest and operating income.

The Italian lender's net income in the three months to the end of June was 1.33 billion euros ($1.36 billion), down from EUR1.51 billion in the same period last year, although up from EUR1.02 billion in the first quarter.

That compares with consensus net-profit expectations of EUR1.00 billion, according to analysts' estimates provided by FactSet.

Operating income was EUR5.35 billion, up 3.3% on year. Net interest income rose 4.8% to EUR2.09 billion, though net fee and commission income dropped 4.8% to EUR2.25 billion.

The company's common equity Tier 1 ratio, a measure of financial strength, was 12.5%, after deducting dividends and a EUR3.4 billion buyback.

The Turin-based bank also said its credit quality improved, with nonperforming loans reduced by 27% over the course of the first half of 2022.

However, operating costs climbed 4.5% on quarter, with personnel expenses up 2.4%.

Still, the company said it generated solid profitability, even in what it described as "complex contexts."

Intesa confirmed its midterm guidance of net income of EUR6.5 billion in 2025.

 

Write to Ed Frankl at edward.frankl@dowjones.com

 

(END) Dow Jones Newswires

July 29, 2022 07:54 ET (11:54 GMT)

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