May 14 (Bloomberg) -- Unione di Banche Italiane SCPA, Italy’s fifth-largest bank by assets, said first-quarter profit more than doubled on higher income from lending and lower costs.
Net income rose to 58.1 million euros ($79.7 million) from 26.5 million euros a year ago, the Bergamo-based bank said in stock-exchange statement today. UBI was expected to report a profit of 49.8 million euros, according to the average estimate in a Bloomberg survey of six analysts.
Chief Executive Officer Victor Massiah is reducing costs to strengthen UBI’s finances and boost profitability as stricter rules by regulators curb lending and squeeze margins. UBI is one of the 15 Italian lenders being reviewed by the European Central Bank as part of a three-stage asset quality review and stress test before it takes over banking supervision for the euro area in November.
Revenue rose 6.7 percent from a year earlier to 853.4 million euros on higher income from lending and trading. Loan-loss provisions rose to 198.6 million euros from 157.7 million euros.
UBI’s common equity Tier 1 phased-in ratio was 12.2 percent at the end of March, while the common equity ratio under fully applied Basel III capital rules, a key measure of financial strength, was about 10.5 percent.
Financial police arrived this morning at the bank’s headquarters in Bergamo, said a UBI official, who asked not to be identified because of the bank’s internal policy. He couldn’t give additional details.
UBI shares fell 1 percent to 6.32 euros in Milan trading, giving the lender a market value of 5.7 billion euros.
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