UniCredit Profit Rises - Update

(RTTNews) - UniCredit SpA (UNCFF.PK) Tuesday reported a near 12 percent increase in second-quarter profit, as the Italian bank benefited from lower loan-loss provision, higher net interest income and fees, partly offset by lower trading income and tax expense.

The results come amid some improvement in the struggling Italian economy. UniCredit continued to see optimism among businessmen who earlier refused loans or could not avail one.

Under Chief Executive Federico Ghizzoni, UniCredit has cut costs and divested assets to shore up profit.

For the second quarter, UniCredit posted net earnings of 403 million euros, compared with 361 million euros last year.

Adjusted for the revised tax charge on the valuation of the stake in Banca d'Italia, earnings for the quarter were 618 million euros.

Results were mainly helped by loan-loss provision that dropped 35 percent year-over-year to about 1 billion euros.

Meanwhile, total revenue for the quarter slipped 6 percent to 5.73 billion euros from 6.1 billion euros a year ago.

Net interest income for the quarter climbed 3 percent to 3.18 billion euros, and fees and commissions rose 7 percent to 1.95 billion euros. Trading income dropped sharply to 359 million euros.

Results were somewhat offset by a tax charge of 215 million euros on the revaluation of the stake it owns in the Bank of Italy, UniCredit said.

The bank said its asset quality has been improving with gross impaired loans decreasing to 82.4 billion euros.

UniCredit said its head of corporate and investment banking Jean-Pierre Mustier is to step down from January, but will remain a non-executive director on its advisory board.

UniCredit said BNP Paribas will make an offer of 4.78 euros per share to buy out German online broker DAB Bank AG's remaining shareholders. This comes after a deal last week, when UniCredit agreed to sell its 81.4 percent stake in DAB to BNP Paribas for 354 million euros.

In Milan, UniCredit stock closed Tuesday at 5.86 euros, down 0.06 euros or 1.01%, on a volume of 75 million shares.