Italy's biggest bank, UniCredit, today topped forecasts with its best first-quarter result since 2007 and said it would shed bad loans more quickly than anticipated.
UniCredit reported a net profit of €1.1 billion in the three months from January to March, above an average €766m forecast in a consensus of 25 brokers provided by the company.
Revenues rose 4% from the previous quarter to €5.1 billion, mainly driven by fees, while the bank's net interest income eased slightly.
Loan writedowns fell more than expected from a year earlier to €496m. The bank also cut more costs in the first quarter than forecast.
UniCredit has embarked on a restructuring after hiring French banker Jean Pierre Mustier as chief executive in mid-2016.
It raised €13 billion early last year in one of Europe's biggest cash calls, to fund a balance sheet clean-up.
UniCredit said it expected its soured loans to total €37.9 billion at the end of 2019, which would be an improvement on a €40.3 billion target set in December.
To meet regulatory demands, Italian banks have been shedding billions of euros in loans that had soured due to a deep recession.
UniCredit plans to sell €4 billion in impaired loans this year, following a landmark €16 billion disposal in 2017.
The bank said its core capital stood at a solid 13.06% of assets after factoring in a new accounting rule requiring lenders to book expected losses, rather than just actual losses as previously.
