Annual Accounts and Report as at 30 June 2011 Draft - Mediobanca

totalled €2.2bn, as against €0.2bn the previous year. The percentageaccounted for by share premium reserves virtually halved, from 62% to33%. Share issues restricted to staff chiefly through exercise of stockoptions remained relatively insignificant and involved 21 companies, asopposed to 14 in 2009/10, with the amount increasing from €45m to€104m. The value of convertible bond issuance was also negligible.Despite still being far off their pre-crisis levels, dividends reversedthe downward trend witnessed in the past two financial years, rising from€15.2bn to €16.3bn, with the payout ratio declining from 54% to 49%.This increase in dividends was largely attributable to industrial companies,which distributed 79% of the total, compared with 78% the previous year(the changes recorded in absolute terms by insurance companies andbanks offsetting each other), up €1.1bn, €0.7bn of which by energycompanies and utilities. This 1% increase in the industrial companies’share is matched by an equivalent reduction in that of the insurances, from6% to 5%, while the banks’ share was stable, at 16%. Virtually half thecompanies listed on the stock market failed to pay dividends, but the samecompanies measured by market capitalization accounted for barely 8% ofthe aggregate (as against 9% for the preceding period). Public tender offersresulted in five companies being delisted (eight in 2009/10).The net aggregate results for the 2010 financial year posted by Italiancompanies listed as at 30 June 2011 show signs of recovery, with net profitup 30%, from €21.5bn in 2009 to €27.3bn. The most significantcontribution in relative terms came from the industrial companies, whoseprofits were up 30%, and even more so the insurances, which reported twoand-a-halftimes their bottom-line result in 2009; while the contributionfrom banks was marginal, up just 5%.The banks reported aggregate profits of €6.3bn, compared with €6.2bnin 2009, and a return on equity (ROE) of 3.9% (3.8%). The €3.3bndecrease in revenues, most of which was due to reductions in net interestincome (€2.9bn) and net trading income (€2.1bn), was largely offset by theresult in net fee and commission income, up €1.5bn. The decline in netloan loss provisions (€3bn), along with the increase in net writebacks(€1.1bn), was decisive in bringing net profit back to 2009 levels (up€0.3bn). In 2010 regulatory capital levels increased by 4%; theconcomitant, 1% reduction in risk-weighted assets led to an increase in thesolvency margin, from 11.7% to 12.3%. The leverage ratio, measured by14 –