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income and expenses

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INCOME AND EXPENSES

7.9% growth Q/Q, partly as a result of a Covered Bond issuance coming to maturity in October 2018. Net of this, the last quarter is essentially in line with Q3, although it includes interest paid for one month on the EUR 320 mln subordinated debt issued on 30 November 2018

 

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Decrease in fees and commissions on collection and payment services (disposal of the Merchant Acquiring business) and higher commissions paid to Credito Fondiario for NPE servicing. Slight increase in fee and commission income on portfolio management, trading and investment advisory

 

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Positive Y/Y contribution of core trading (EUR 18.4 mln, in line with 2017)

 

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Sharp reduction in the cost base: although Q4 was weighed down by seasonal effects, core operating expenses amounted to EUR 458.2 mln, down significantly compared to both 4Q2017 (-5.1%) and FY17 (-9.9%)

 

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Personnel expenses were down, as a result of the 360 headcount reduction (business disposals and early retirement agreements) and labour cost curbing measures set out in the trade union agreement of 16 December 2017

 

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A decrease was also observed in other core administrative expenses (-7.6% in the 12
months)

 

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operating profit

 

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Gross Operating Profit on an uptrend compared to FY17 on the back of the strong cost-curbing actions that offset the decrease in revenues

 

Cost/income ratio at 93.7% (91.9% net of IFRS9 impact on NII), down compared to FY17 (98.5%)

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