UNICREDIT: A PAN EUROPEAN WINNER
CONTINUED DISCIPLINED EXECUTION OF TRANSFORM 2019 DRIVES TANGIBLE IMPROVEMENTS
NON CORE RUNDOWN ACCELERATED TO 2021
 RoTE: Return on Tangible Equity (annualised net profit divided by average tangible equity).
 IFRS9 first time adoption (FTA) impact on 1 January 2018 of -104bps on fully loaded CET 1 ratio, equivalent to around -€3.76 bn (gross of tax effect) deriving from LLP effect, write offs, classification and measurement. For further details please refer to footnote n.32.
|1Q18 Highlights3||Resilient revenues at €5.1 bn (-0.7 per cent Y/Y, +4.2 per cent Q/Q) mainly supported by fees, up 2.8 per cent Y/Y to €1.7 bn (+4.0 per cent Q/Q). Resilient NII (-0.4 per cent Q/Q) at €2.6 bn, in line with idance|
|Operating expenses at €2.74 bn (-5.2 per cent Y/Y, -2.0 per cent Q/Q) mainly thanks to lower hr costs (-6.9 per cent Y/Y, -3.9 per cent Q/Q) with FTEs down 6,058 Y/Y and 1,587 Q/Q. C/I ratio at 53.5 per cent (-2.5 p.p. Y/Y, -3.4 p.p. Q/Q)|
|LLPs down 35.2 per cent Y/Y to €496 m, leading to a seasonally low CoR of 45 bps|
|Net operating profit at €1.9 bn, up 25.5 per cent Y/Y and 47.2 per cent Q/Q|
|Net profit at €1.1 bn and RoTE at 8.9 per cent|
|CEE, Commercial Banking Italy and CIB main contributors to net profit|
|Group Core Bank net operating profit at €2.1 bn, up 15.3 per cent Y/Y thanks to stable revenues and cost control. RoTE up 1.1 p.p. Y/Y to 10.4 per cent|
|Capital||Fully loaded CET1 ratio at 13.06 per cent in 1Q18, including 104 bps of IFRS9 FTA impact|
|Strong capital position allowing the Group to accelerate Non Core rundown. higher IFRS9 FTA impact on non performing residential mortgages|
|Dividend payout of 20 per cent in 2018 and 30 per cent in 2019 confirmed|
|Fully loaded leverage ratio at 5.35 per cent in 1Q18|
|Asset Quality||Group gross NPE4 ratio down 2.1 p.p. Y/Y to 9.5 per cent in 1Q18, with a coverage ratio of 60.3 per cent|
|Group Core gross NPE ratio down 0.9 p.p. Y/Y to 4.7 per cent in 1Q18, with a coverage ratio of 57.9 per cent|
|Non Core gross NPE down €6.9 bn Y/Y to €23.6 bn in 1Q18, with a coverage ratio of 62.4 per cent|
|Transform 2019 Update||Year end 2018 fully loaded CET1 ratio between 12.3 per cent and 12.6 per cent. 2019 fully loaded CET1 ratio target confirmed above 12.5 per cent|
|FINO transaction successfully closed in January 2018|
|Further decisive action with accelerated full rundown of Non Core by the end of 2021, brought forward from 2025. €1.8 bn of write-offs in Non Core in 1Q18|
|FY18 Group gross NPE disposal target of €4 bn, of which €2 bn in Non Core|
|Improved 2019 Gross NPE target of €37.9 bn for Group, of which €14.9 bn in Non Core, Further down by €2.3 bn|
|Operating model transformation ahead of schedule, with 78 per cent of planned branch closures and 75 per cent of FTE reduction target achieved|
|Strategic commercial initiatives ongoing and E2E process redesign in progress|
|UniCredit only bank in Italy to offer all three mobile payments services: Apple Pay, Alipay and Samsung Pay, the latter successfully launched in 1Q18, further strengthening the Group's mobile payments offering|
|New corporate governance implemented in line with best in class European peers|
 Starting from 1 January 2018, IFRS9 accounting standard was adopted, envisaging a new framework for provisioning computation based on expected loss rather than on incurred loss. Please refer to "Basis of preparation" for further details on this topic.
 NPEs: Non Performing Exposures. The perimeter of Non Performing Loans is equivalent to the perimeter of EBA non performing exposures. NPEs are broken down in bad exposures, unlikely-to-pay and past due.
Milan, 10 May 2018: on 9 May 2018, the Board of Directors of UniCredit S.p.A. approved the Group's 1Q18 consolidated financial accounts as at March 31, 2018.
Jean Pierre Mustier, Chief Executive Officer of UniCredit S.p.A., commenting on the 1Q18 Group results:
"UniCredit's 2018 first quarter results, the best first quarter in more than a decade, were driven by a continued strong commercial dynamic throughout the Group, underpinned by a renewed and successful customer focus which has translated into almost half a million of gross new clients.
Our Core Bank turned in a solid performance with a net profit of 1.2 billion Euro and a RoTE of 10.4 per cent, up 1.1 percentage points year on year. The Core Bank gross NPE ratio is now 4.7 per cent, improving 0.9 percentage points year on year. Thanks to our strong capital position, we have taken further decisive action to accelerate the rundown of the Non-Core portfolio to 2021. This will be done through a combination of disposals and write offs.
At the start of its second year, Transform 2019 is ahead of schedule and yielding tangible results, such as 78 per cent of the agreed branch closures and 75 per cent of FTE reductions already having been achieved, with costs decreasing as planned.
Our first quarter fully loaded CET1 ratio stands 13.06 per cent, with a year-end target range of between 12.3 and 12.6 per cent.
All Transform 2019 targets are confirmed and we are continuing our disciplined execution of the plan with all team members working together to make UniCredit a true pan-European winner."