UniCredit targets €5.3bn net profit and job cuts


Italy’s UniCredit will target €5.3bn net profit by 2018 as well as higher sustainable return to shareholders with Return on Tangible Equity (RoTE) at 11%, the bank revealed in its strategic plan.

UniCredit also announced that it will cut 18,200 jobs – 14% of its total workforce and more than expected – which will mainly result from the sale of the Ukrainian subsidiary and the Pioneer Investments joint venture with Santander Asset Management.

The largest Italian bank by assets also said that it will sell its Austrian retail banking unit.

The strategic plan also forecasts a CET1 capital  ratio of 12.6% by 2018 and it includes a €1.2bn investment in digital evolution.

At the same time, UniCredit announced that it has reached a binding agreement to combine Pioneer Investments and Santander Asset Management.

“Further to the preliminary agreement announced on 23rd April 2015, UniCredit, Santander, and affiliates of Warburg Pincus and General Atlantic have signed a binding master agreement to combine Pioneer Investments and Santander Asset Management to create a leading global asset manager.

“As the next step, the parties will be seeking the necessary regulatory and other approvals in many of the markets where the two firms have a presence. The full closing of the transaction is expected to happen in 2016,” the statement read.

The details of the deal, as in total AUM, number of funds on offer and market footprint are yet to be released by the company.

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