UniCredit shares rallied sharply in Milan trading, climbing more than 6% to approach a 52-week peak. The surge followed the bank's announcement of upgraded financial objectives and a substantial capital return program.
Elevated Targets and Strategic Stakes
The Italian lender now aims for a net profit of €11 billion in 2026, with a longer-term goal of €13 billion by 2028. A significant portion of this growth is expected to come from its strategic equity holdings, including a 26% stake in Germany's Commerzbank and a 29.8% position in Greece's Alpha Bank. The bank anticipates these investments will contribute an additional €1 billion in net revenue by 2028.
For the fourth quarter, UniCredit reported a net profit of €2.17 billion, which included €336 million in tax credits. The bank's CET1 capital ratio stood at a robust 14.7% at year-end.
Substantial Capital Return Program
Central to the market's positive reaction is a plan to distribute approximately €30 billion to shareholders over the next three years through dividends and share repurchases. This commitment is part of a broader five-year strategy targeting total distributions of around €50 billion. A final dividend for 2026 is scheduled for an ex-date of April 20, with payment expected on April 22, pending approval at the shareholder meeting on March 31.
CEO Addresses Strategic Questions
Chief Executive Andrea Orcel addressed market speculation, explicitly ruling out an imminent broader deal with insurer Generali, describing it solely as an industrial partner. Regarding the Commerzbank stake, Orcel noted a potential deal exists "if and when conditions are right," while acknowledging previous German regulatory suggestions to reduce the holding.
Orcel also commented on a strained relationship with fund manager Amundi, a key distribution partner. He confirmed the bank has set aside provisions for penalties incurred as it shifts client assets into its own Onemarkets funds, with the existing distribution agreement remaining in place until mid-2027.
Analysts highlighted that the rally's sustainability depends on the bank's ability to deliver on these targets amid challenges like narrowing lending margins and potential political or regulatory hurdles related to its cross-border investments.