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09 Aug 2019 15:31
BFF BANKING GROUP 1H 2019 FINANCIAL RESULTS - ERRATA CORRIGE for amendment to the Liquidity Coverage Ratio
The Board of Directors of Banca Farmafactoring S.p.A. approved today the 1H 2019 consolidated financial statements of BFF Banking Group.


  • Adjusted Net Income of €41.2m (+3% y/y), with 33% Adjusted RoTE vs. 32% in 1H18
  • Adjusted Net Interest Income almost flat (-1% y/y), despite €7.4m of lower net LPIs over-recovery vs. 1H18, and with the stock of unrecognized off-balance sheet LPI growing by €33m YoY to €391m
  • Net Customer Loans up by 15% y/y at €3,454m, of which 34% outside Italy
  • Sound liquidity ratios, with LCR at 499.1% at the end of Jun-19
  • Strong reduction in Net Impaired Assets (-44% y/y and -21% vs. YE18), with the Net NPLs/loans ratio down to 0.1% (excluding Italian municipalities in conservatorship). 75% of total Net Impaired Assets are towards the public sector
  • Net Impaired Assets towards private sector down -41% vs. YE18
  • Annualised Cost of Risk down at 3bps
  • Strong capital position: TC and CET1 ratios[1] of 16.1% and 11.6% (17.8% and 13.3% including the Reported Net Income for the period), well above SREP requirements


Milan, August 8th, 2019 – The Board of Directors of Banca Farmafactoring S.p.A. (BFF) approved today the half-year 2019 consolidated financial statements.

1H19 Adjusted Net Income was €41.2m vs. €39.9m in 1H18, +3% y/y despite €7.4m of lower net LPI over-recovery vs. 1H18, with the stock of unrecognized off-balance LPIs (back book income reserve) increased by €33m YoY at €391m (+9% y/y, €358m at Jun-18). The Reported Net Income in 1H19 was €38.1m compared to €41.3m in 1H18, mainly due to €3.6m of lower impact from the change in €/PLN exchange rate (negative impact for €0.8m in 1H19 vs. positive impact for €2.8m in 1H18) and offset by a positive (negative in 1H18) change in equity reserve, reflecting the natural hedging approach adopted by BFF.

Adjusted Net Interest Income and Adjusted Banking Income were almost flat (-1% and -2% y/y), despite €7.4m of lower net LPI over-recovery in 1H19 vs. 1H18.

The operating leverage improved with annualised Adjusted Costs/Average Loans ratio decreasing from 2.29% in 1H18 to 2.01% in 1H19. The Adjusted Cost/Income ratio increased to 40%, entirely due to a lower income from the net LPI over-recovery.

Net Customer Loans at the end of Jun-19 amounted to €3,454m, +15% compared to €3,000m at the end of Jun-18. At the end of Jun-19, the international markets (Spain, Portugal, Poland, Slovakia, Czech Republic, Greece and Croatia) accounted for 34% of loans (32% at the end of Jun-18). New Business Volumes were €1,969m in 1H19, -4% y/y mainly due to a slight reduction of volume in Italy and a strong 1H18 in Portugal.

As of 30/06/2019 the Total Capital ratio was 16.1%, above the company’s 15% target threshold, and the CET1 ratio was 11.6%, confirming the Group’s solid capital position and ability to organically fund growth. Both ratios are calculated excluding €38.1m of Reported Net Income of the period, which would have increased both ratios by 175bps. The Reported Net Income, not included in the capital ratios, more than offsets the expected capital absorption from IOS Finance acquisition. Both capital ratios include, instead, the negative mark-to-market effect on HTC&S portfolio for €3.1m after taxes.

The Group continues to enjoy a low risk profile, with Net NPLs at 1.3% of Net Customer Loans (0.1% net of Italian municipalities in conservatorship – “Comuni in dissesto”) and an annualized Cost of Risk of 3bps. The total Net Impaired Assets decreased by -44% y/y and -21% vs. YE18, with the Net Impaired Assets towards the private sector down by -41% compared to Dec-18. 75% of the total Net Impaired Assets as of Jun-19 are towards the public sector.


[1] Calculated on the Banking Group perimeter (pursuant to TUB – Testo Unico Bancario).