For Italian banks in Italy, 2023 was also a golden year. The five major groups (Intesa Sanpaolo, Unicredit, MPS, Banco BPM, and Bper) put up aggregate profits of 20.7 billion euros, a figure that nearly doubled from the 11.5 billion euros in 2022. The results were actually largely expected, following accounts for the first nine months of the year that showed a sharp rebound in net interest income, a consequence of the ECB's continued rate hikes. However, the trend continued during the fourth quarter, pushing beyond expectations. However, banks were expected to test the waters especially when it came to forecasts for 2024: for the ECB's policy of rate hikes has now come to an end, while the time is approaching, albeit gradually, when the major central banks will begin to cut the cost of money. And the margins are bound to shrink. The real news, at least according to the estimates released by the institutions along with the results, is that Italian banks have said they are ready to face the backlash of this turnaround, maintaining the same level of profits (as Unicredit, for example, has promised) or even increasing them (this is the case, remaining among the biggies, of Intesa Sanpaolo). Generous dividend policies, the kind that attract investors, have been confirmed; capital is solid; and impaired loans remain below guarded levels.
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