UniCredit, eToro: ‘Mps selective acquisition announcement first step of what investors expect from Orcel’

Thus Edoardo Fusco Femiano, eToro market analyst, comments on the Unicredit quarterly, released today before the start of the trading day on Piazza Affari:

“In the broader context of the European quarterly season, banks are reporting positive results, although their size, trade exposure and weak Eurozone recovery put them at a valuation discount relative to their US peers. Unicredit had a great quarter, beating estimates on almost every aspect of the business, from revenues to earnings to credit loss reserves. The announcement of a ‘selective’ acquisition of Monte dei Paschi is the first step in what investors expect from Andrea Orcel: an intense cost cut and a careful search for a partner to accelerate the consolidation process among European banks. From a price action perspective, the stock is still lagging behind its European competitors, but the ‘Orcel’s era has just begun and it is too early to have a clearer view of his plans and future execution. “

Last night UniCredit announced that “UniCredit SpA (‘UniCredit’) and the Ministry of Economy and Finance of the Italian Republic (the ‘MEF’), in its capacity as majority shareholder of Banca Monte dei Paschi di Siena SpA (‘ MPS ‘), approved the conditions for a’ potential transaction involving the commercial activities of MPS, through the definition of a selected perimeter and adequate risk mitigation measures. To this end, they will initiate exclusive discussions to verify the feasibility of the operation “.