Unicredit sees issuance spike in 2018 while sales increase by more than 40%

Unicredit saw its structured products sales increase by 42% year-on-year during the first nine months of 2018 while issuance increased by 100% during the period, according to SRP data. The Italian global banking and financial services company collected an estimated €4.1 billion from 885 products in Europe between January 1 and September 30, 2018, up from €2.9 billion (from 444 products) during the same period last year.

Fifty percent of the sales volumes were achieved in Italy, where the bank sold 46 certificates worth €2 billion in the first three quarters of the year (9M 2017: €1.9 billion from 144 products). All of Unicredit's products in Italy were linked to equities, with the majority (29) linked to a single share, and the bank was also responsible for the best-selling product in the period. Cash Collect a capitale protetto 100% - 30/06/2025, a seven-year 100% capital protected certificate which offers an annual coupon of 2.3% providing the Eurostoxx Select Dividend 30 closes at or above its initial level on the observation date, sold €163.7m during its subscription period.

Unicredit was also active in Germany where, apart from 550 regular structured products, the bank  issued more than 55,000 flow and leverage products in the first nine months – such as turbos, (reverse) bonus- and capped bonus certificates, and reverse convertibles.

In the Czech Republic, Unicredit launched 277 certificates, predominately autocallables; in Hungary the bank sold 10 products, including the HVB EUR All-Time-High Note, a 6.25-year note linked to the in-house Emerging Focus Strategy Index; and in Poland four express plus certificates were distributed by the bank.

Unicredit reported revenues in the third quarter of 2018, at €4.8 billion, were up 2% on the year (-2.6% q-o-q) thanks to higher commercial revenues offsetting lower trading income while net interest income (NII) increased 3.2% quarter-on-quarter driven by positive commercial dynamics and higher contribution from the investment portfolio.

Revenues for the first nine months of 2018 totalled €14.9 billion (-1.1% y-o-y) with NII up 1.2% to €8.1 billion and fees up 1.7% to €5.1 billion, mainly thanks to transactional and management fees. Trading income, however, was down 24.3% in 9M2018 due to an unfavourable market environment, according to the bank.

As at September 30, 2017, Unicredit had debt securities worth €79 billion in issue, down 9.2% quarter-on-quarter and down 25.3% from September last year. The book value of sovereign debt securities as at the end of September amounted to €121.3 billion, of which 89% was concentrated in eight countries: Italy, Spain, Germany, Austria, Japan, France, Hungary and Romania. Italy, with €57.8 billion represented around 48% of the total. The remaining 11% of the total of sovereign debt securities, at €13.4 billion, was divided into 35 countries, including Bulgaria, Croatia, Czech Republic, Poland, Portugal, Serbia, US, Slovakia and Russia.

‘Unicredit has delivered strong underlying Q3 results […] in an increasingly challenging macro-economic environment,’ said Jean Pierre Mustier (pictured), chief executive officer, Unicredit, commenting on the 3Q and 9M2018 group results. ‘Group core net operating profit in the third quarter was €1.8 billion, up 21.9% year-on-year, while adjusted group core return on tangible equity stands at 10.4% for the first nine months.’

Click the link to view the full Unicredit third quarter and nine month 2018 results, presentation and the divisional database.