UniCredit scraps Russian plans due to Ukraine crisis

Posted Jan 28, 2022, 6:33 PMUpdated on Jan 28, 2022 at 6:57 PM

UniCredit abandons its Russian projects. Tensions between Moscow and Washington over Ukraine got the better of its designs on Otkritie Bank. “Given the geopolitical environment, we have decided to withdraw from the data room,” said Friday, the managing director of the second Italian bank Andrea Orcel.

The revelation of a possible takeover of part of the activities of the Russian banking establishment had caused the price of UniCredit to fall.

Results above expectations

His new boss especially insisted on his “excellent results, higher than forecasts, for the whole of the year”. Revenues amounted to 18 billion euros and underlying profit to 3.9 billion euros. Restructuring costs and other charges related to the disposal of assets deemed non-strategic nevertheless caused a loss of 1.44 billion euros in the fourth quarter.

“We exceeded our annual objectives and increased our rate of return on equity (ROTE) to 7.3%”, welcomed Andrea Orcel, attentive to the creation of value for shareholders. He confirmed that he would distribute 3.75 billion euros to them from the 2021 results, comprising a cash dividend of 1.17 billion euros and a share buyback of 2.58 billion euros.

A strengthened partnership with Allianz

UniCredit has also decided to consolidate its partnership agreements established since 1996 with the insurer Allianz in Germany, Italy and in the countries of Central and Eastern Europe. “This agreement represents a significant step forward in our strategic plan, commented Andrea Orcel. This is proof of what we can achieve through true, strong and effective collaboration by working towards greater technological integration for the benefit of our customers. »

In Italy, the existing agreements, allowing the bank’s customers to access Allianz life and damage insurance, have been renewed until 2027. The Italian bank, however, points out that it reserves the right to show “flexibility strategy” from 2024.

A date on which another bancassurance partnership must expire, the one signed by UniCredit in 2017 with the number 2 life insurance company in France, attached to La Banque Postale: CNP Assurances. However, the links between UniCredit and the French have just been strengthened with the takeover by CNP of Aviva’s life insurance activities in Italy.

The agreement between Allianz and UniCredit provides for joint investments. It must also “pave the way for cooperation in the field of ‘insur-banking’ allowing UniCredit to offer its best banking products to customers on the open platform of Allianz in Germany, Italy and other jurisdictions,” the two groups said.

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