MILAN—Italian lender Mediobanca SpA is gearing up to seize
business opportunities in Iran since a landmark nuclear deal struck
with the U.S. and other world powers is likely to prompt the
lifting of economic sanctions against the middle eastern
country.
"There are very interesting opportunities in a country in which
every sector is bound to grow," said Chief Executive Alberto Nagel.
"We are very determined in grabbing these opportunities, but it
will all depend on external variables."
Mr. Nagel's comments come as the bank posted an 80% increase in
net profit for its fiscal fourth quarter to €124.2 million, helped
by higher net interest income and sharply lower provisions for bad
loans.
Revenue for the quarter dropped to €529.8 million from €551
million. For the fiscal year 2014-2015 revenue rose to €2.04
billion, from €1.82 billion. It was the best result in the
Mediobanca's history, the lender said. Net profit for the fiscal
year rose 27% to €590 million.
Together with the Italian Ministry of economic development and
export credit company SACE, the bank signed an agreement on Tuesday
with Iran's Ministry of Economy and Finance and Central Bank aimed
at developing economic and trade relations between Italy and
Iran.
The Italian-Iranian agreement follows a historic deal reached
between Iran and a six-nation negotiating bloc three weeks ago
which strictly limits Tehran's nuclear activity for at least a
decade in exchange for lifting billions of dollars in economic
sanctions.
Mediobanca started to work in Iran 60 years ago, lending to
Iranian state-owned banks and supporting Italian companies doing
business in the Islamic Republic.
The Italian lender aims to play a role in the privatization of
Iran's state-owned companies, in foreign investments into Iranian
strategic sectors such as oil and finance, as well as developing
its lending and debt capital markets business with the Iranian
state and private sectors.
SACE estimated that removing sanctions may generate Italian
exports to Iran between 2015 and 2018 worth €3 billion, primarily
in the mechanical engineering, oil and gas and transport
sectors.
Mediobanca also said it has agreed to buy a 51% stake in
London-based credit manager Cairn Capital Group Ltd from Royal Bank
of Scotland and other institutional investors. As part of the deal,
it will have the option to buy all or part of the remaining stake
in Cairn, now held mainly by its management and staff.
The bank didn't say how much it paid for Cairn, but Mr. Nagel
said it would barely impact its Common Equity Tier 1 ratio—a
measure of the bank's capital strength, which for Mediobanca was
12% at the end of the fiscal year.
The acquisition is part of a strategic plan the bank launched
two years ago aimed at focusing more on retail and investment
banking, on less capital-absorbing activities and on shedding its
vast portfolio of stakes in pre-eminent Italian companies, while
expanding its business outside of Italy.
Mr. Nagel said that Cairn Capital will contribute around 8% of
the bank's commission income. Mediobanca plans to buy more
businesses like Cairn, he said.
Net interest income for the quarter rose to €303 million from
€278 million a year earlier, helped by a lower cost of funding.
Provisions for bad loans declined 34% to €123 million for the
quarter, while net fees and commissions income dropped 26% to €111
million.
The bank proposed a divided payment for the fiscal year
2014-2015 of €0.25 a share, up 67% from the previous fiscal
year.
Write to Giovanni Legorano at giovanni.legorano@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
