Rising profitability and commercial network development

During its meeting on September 27, Credito Valtellinese Board of Directors examined and approved the parent bank Credito Valtellinese's half-year report. Credito Valtellinese's gross operating result for the first half of 1996 totalled 51.6 billion lire, increasing by 50.8 per cent in comparison with the first half of 1995.

The interest margin increased by 7.2 per cent, attaining 83.4 billion, incomes from services increased by 21.3 per cent, attaining 17.4 billion and profits from financial activities increased by 68.5 per cent, attaining 15.6 billion, while administrative costs increased by 2.3 per cent only, attaining 75.9 billion lire.

Profit from ordinary activities consequently increased by 60.5 per cent, totalling 30.6 billion. Taking into account the taxation 24.5% increase (18.3 billion in comparison with 14.7 billion in the first half of 1995) and the prudent credit valuation (net value adjustments amounted to 14.9 billion in comparison with 9.9 billion in the first half of 1995, with a 49.8 per cent increase), net profit totalled 12 billion (+9.5%).

As regards Credito Valtellinese's main aggregates, direct incomes from customers attained 3,112 billion (+6.2%), while portfolio administrations and assets administrations exceeded 4,146 billion (+28.2%). Therefore, Credito Valtellinese globally administrated 7,258 billion (+18.1%). Economic input to customers increased by 9.8 per cent attaining 2,423 billion, while the unpaid bill influence was largely below the average.

Thanks to a successful conversion of "Credito Valtellinese 7% 1995-1998 convertible" bond issue, as well as to a successful exercise of the warrants, net capital increased by 15.6 per cent and attained 542 billion.

The number of shareholders considerably increased in comparison with the first half of 1995, from 42,100 to 44,500.

During the meeting, Credito Valtellinese Board of Directors also examined and approved the Group's consolidated half-year report, which shows above all the positive performance of the controlled company Credito Artigiano's profitability.

As regards Credito Artigiano's profit and loss account, the interest margin increased by 6.7 per cent, attaining 63.6 billion, making also the intermediation margin increase by 23.2 per cent and attain 96 billion lire.

Profit from ordinary activities consequently attained 12.1 billion (+126.6%), while net profit for the period - always taking into consideration the taxation increase (8.2 billion, namely +115.6%) and prudent credit adjustments (11.3 billion, namely 12.7%) - totalled 4.7 billion (+256.1%).

Credito Valtellinese banking Group's consolidated profit for the first half of 1996 totalled 7.3 billion lire, in comparison with 7.1 billion on June 1995.

At the end of June, Credito Valtellinese Group's direct incomes totalled 5,591 billion (+4.8%), while credits to customers attained 3,895 billion (+6.7%). Indirect incomes totalled 7,700 billion (+20.4%), more than 2,050 of which concerned assets administrations (+15%).

During the first half of 1996, Credito Valtellinese and Credito Artigiano have been further developing the Group commercial network, which now consists of 105 branches, located in the North of Lombardy (provinces of Sondrio, Como, Lecco, Milan, Bergamo and Varese) in the provinces of Florence and Prato, and in Rome.

As regards the company appointments, on May 10 1996, Credito Valtellinese Board of Directors appointed Mr Giovanni De Censi Managing Director of the bank. Consequently, Renato Bartesaghi and Gino Del Marco were entrusted with the General Management and appointed joint-General Managers.