UniCredit exceeded earnings expectations for 2024, posting a net profit of €9.3 billion and committing to stable profits in 2025 despite declining interest rates. The bank plans to return €9 billion to investors through share buybacks and dividends, with an even higher distribution expected in 2025.
Under CEO Andrea Orcel, UniCredit has pursued an aggressive expansion strategy, acquiring a 28% stake in Germany’s Commerzbank, launching a bid for Banco BPM, and taking a 4.1% stake in Italy’s biggest insurer, Generali. Orcel emphasized that external growth would only be pursued if it met strict financial criteria.
Despite a positive earnings report, UniCredit shares fell 3.4%, with traders citing profit-taking after a 50% rise over the past year. The decline also followed reports that long-time shareholder Delfin might reduce its 2.7% stake.
Looking ahead, UniCredit expects net interest income to decline moderately in 2025 due to lower eurozone interest rates and efforts to scale back its Russian business, as per ECB directives. The bank projects net revenues of over €23 billion in 2025, down from €24.2 billion in 2024, despite a mid-single-digit increase in fees.
UniCredit’s strong financial position, bolstered by years of record profits, gives it leverage for future acquisitions. Analysts praised the bank’s outlook, with JPMorgan noting that its shareholder payouts and 2027 profit target of €10 billion exceeded expectations.
