Banca Progetto Collections Increased in the First Nine Months to €5.2 Billion

Excellent results in the first nine months of 2023 for Banca Progetto, the Italian challenger bank specializing in services for Italian SMEs and private customers, controlled since 2015 by Oaktree Capital Management.

Total collection through deposit accounts in Italy, Germany, Spain, and the Netherlands amounted to approximately €5.2 billion, up from €5 billion in the first half of the year and from €4.4 billion at the end of 2022.

While new medium-long-term loans granted by Banaca Progetto to businesses amounted to €2.1 billion, up by €130 million compared to the same period in 2022, with 79% of the loans in the year in which they were allocated for investment purposes. All with a net profit for the 9 months which rose to €55.7 million (+21.2% from the €46 million of the first nine months of 2022) and a cost/income ratio net of non-recurring elements, equal to 30.9%, an improvement compared to the 31.5% recorded as of 30 September 2022.

Numbers that are a good business card in the perspective of the bank’s listing project on Piazza Affari, in the wake of the declarations of the CEO Paolo Fiorentino at the end of September, released to the Adnkronos news agency on the sidelines of an ANSPC event on ” public guarantees and the credit system.”

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On the financing front, Banca Progetto’s strong development of the non-recourse purchase of VAT credits from SMEs continued in the third quarter

After the meeting of last October 2nd, in the extraordinary part of which the proposal for a share split was envisaged, a capital increase to serve the listing on Euronext Milan, and the adoption of the post-listing statute, the lights are now turning on for the next October 19th, the date on which the shareholders will meet again to appoint, among other things, a standing auditor, with effectiveness subject to the start of trading of Banca Progetto’s shares on Euronext Milan.

According to what was reported in recent weeks by Corriere, Oaktree is trying to obtain a valuation of around €400-€500 million, a range that is in line with the value the bank had aimed for last year. Then, the same sole shareholder had explored a possible sale with the help of Morgan Stanley, effectively putting to rest the rumors of a stock market listing that had been talked about since 2021 for this year.

Returning to the nine-month results, on the balance sheet front, total assets stood at €8.1 billion (from €6.7 billion at the end of 2022), with a CET 1 Ratio of 19% (from 17% to the end of 2022), an annualized cost of risk at 0.9% (0.7% at 31 December 2022) and a net NPE ratio at approximately 2% (stable compared to the end-2022 figure).

Fiorentino commented: “The results as of 30 September 2023 confirm the growth trend of the bank, exceeding the figure for the whole of 2022 in terms of net profit. The progression in the volumes of financing for SMEs remains sustained, with a product offering now enriched by factoring, demonstrating our great attention to the needs of businesses: almost 80% of the credit granted supports their investment projects, a significant part of which in the context of the ecological transition”.

On the financing front, the strong development of the non-recourse purchase of VAT credits by Banca Progetto from SMEs continued in the third quarter, with volumes of €159 million over the nine months, compared to €66 million as of September 30th, 2022 (+ 141% on an annual basis). The new line of factoring services, launched during the first half of the year, recorded volumes of €69 million.

Banca Progetto finalized a further securitization operation last summer with an underlying portfolio of loans provided by the bank to Italian SMEs and guaranteed by the Central Guarantee Fund and SACE. Specifically, the volume of underlying loans, at a variable rate linked to the 3-month Euribor, and transferred to the Progetto PMI 5 vehicle, amounted to approximately €725 million in total.

The operation, which saw JP Morgan in the role of arranger, was based on the provision of a €500 million senior facility by the same US banking group, which therefore plays the role of original senior lender, and on the issue of junior class securities for approximately €225 million fully subscribed by the bank.

In the first half of the year, however, there were two securitization operations finalized by the bank with a total collection of €750 million at the end of June. Banca Progetto had in fact announced the conclusion of a €670 million securitization on a portfolio of loans provided to Italian SMEs and guaranteed by the PM I Guarantee Fund, through the special purpose vehicle Progetto PMI 4 srl; while the previous securitization, announced at the end of May, through the vehicle Progetto PMI 3 srl, was for €80 million.

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First published in Be Beez. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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