Italy

UniCredit’s next task is to kick-start growth

8 February 2018

The Italian bank is back in the black with an adjusted net profit of 3.7 bln euros. With the balance sheet fixed and much cost-cutting complete, CEO Jean Pierre Mustier can focus on boosting revenue. But ramping up product sales could be harder without its asset management arm.

Unlocking TIM’s network value requires extra step

7 February 2018

Italy’s biggest telco is looking to spin off its fixed-line network. This will shed light on the network’s cash-generating potential. Listing a minority stake further down the line could add value to TIM’s depressed shares and help the holding company lower its debt mountain.

Intesa dividend pledge depends on Italian growth

6 February 2018

The country’s biggest bank promises 6 bln euros of net profit in 2021 thanks to a push into wealth and insurance products. If CEO Carlo Messina keeps his word, payouts to shareholders over the next four years will be 50 percent higher. But only if there are no upsets at home.

Cox: Sliding stocks don’t surprise our readers

5 February 2018

From Mumbai to Milan, we polled participants at our Predictions 2018 summits. Even before last week's rout, most thought investors are too exuberant, bitcoin is a bubble and Donald Trump is doing poorly. More surprising were regional takes on NAFTA, Italian elections and Brexit.

Italian bank veteran’s SPAXS attack is well timed

2 February 2018

Former Intesa boss Corrado Passera has raised 600 mln euros for a listed special-purpose vehicle. That will fund a low-cost digital bank which will lend to small businesses shunned by bad debt-laden rivals. With Italy’s economy rebounding, a selective approach could pay off.

Italo valuation underpinned by racy growth

29 January 2018

Europe’s first private fast-train operator will list next month. The track Italo runs on is owned by Italy’s incumbent rail group, a competitor, and a 1.7 bln euro valuation assumes rapid growth. But low-cost efficiency and EU train liberalization provide a rationale.

Italy’s flat-tax talk rests on shaky ground

26 January 2018

Silvio Berlusconi and his centre-right allies want to replace progressive income taxation with a flat levy. Italy’s fiscal code needs a revamp: it’s unjust and complex. But the idea won’t fly without budget cuts. A serious pledge to fight tax cheats is also missing from the debate.

Xi Jinping wannabes flub their lines at Davos

25 January 2018

Leaders including Emmanuel Macron of France and Germany’s Angela Merkel predictably spoke up for global cooperation ahead of Donald Trump’s finale. Unlike the Chinese president last year, however, their rhetoric fell flat. Competition for investment further muddles the message.

Fiat Chrysler powers ahead in carmaker wacky races

25 January 2018

Its shares are the industry's best performer of the past year, and its multiple leaves sleeker rivals for dust. Yet earnings are only so-so. Investors may be expecting a sale, or only clocking short-term results. It's a tricky lead for CEO Sergio Marchionne's successor to defend.

Guest view: Market rocket fuel will run out

18 January 2018

Investors are pushing up U.S. equities with little regard for an array of warning signals, writes former Citibank executive William Rhodes. The Federal Reserve is running out of time to warn them about their “irrational exuberance” before a probable market correction this year.

Vivendi’s Italian media journey hits roadblock

18 January 2018

The French media group run by Vincent Bolloré will have to redraft a venture between its pay-TV business and Telecom Italia, which it controls. Regulators and independent directors objected. Bolloré needs to make a clear case for his strategy of combining content and telecoms.

Sugar-for-supplements swap will test Nestlé boss

16 January 2018

The KitKat maker is selling its U.S. candy arm to Ferrero for a sweet $2.8 bln to invest in products with better growth than junk food. But high valuations for alternatives like vitamin pills limit CEO Mark Schneider’s opportunities to make Nestlé a clean-living champion.

Markets start doing Mario Draghi’s job for him

12 January 2018

The euro hit three-year highs and government bond yields rose after a hint the ECB boss may rethink how long ultra-loose policy will last. The moves amount to tighter monetary conditions. That buys rate-setters time to phase out negative rates even though growth is picking up.

Intesa can afford to speed bad debt cleanup

11 January 2018

Italy’s biggest retail bank may sell up to 15 bln euros of sour loans. It looks like a reversal of boss Carlo Messina’s plan to keep bad debts rather than sell them cheaply. But Intesa can take the hit and, with regulators bearing down on dud assets, a quick exit makes sense.

Italy’s pension U-turn would try markets’ patience

10 January 2018

Centre-right parties, frontrunners in March elections, have vowed to scrap a key pension reform passed during the 2011 crisis. The law is rigid, but axing it would hurt young Italians and widen Rome’s fiscal deficit. Investors would have a reason to avoid Italian debt.

Anti-euro debate rears its head in Italy

5 January 2018

Northern League leader Matteo Salvini has reiterated his opposition to the single currency. Growing Italian discontent with the EU could make an anti-euro stance a vote-winner in upcoming elections. Despite Europe’s economic revival, monetary union remains a political target.

Germany will follow money in EU top jobs carve-up

4 January 2018

Jockeying to replace the region’s most powerful people, including European Central Bank boss Mario Draghi, will begin in earnest in 2018. Proposed new posts like a euro zone finance minister complicate the contest. Berlin will prefer control of purse strings to interest rates.

Italy will go back to its old ways in 2018

2 January 2018

The country’s flawed electoral law will produce a hung parliament in national polls. Reformist forces will be weaker while former Prime Minister Silvio Berlusconi will gain traction. A return to the frail coalitions of the past makes it harder to cut public debt and red tape.

Wanted: Italian-American carmaker seeks new driver

29 December 2017

CEO Sergio Marchionne will soon head for FCA’s off ramp. A blizzard of well-timed deals helped spark stellar returns, but the group has low margins and big gaps. Marchionne also wears too many hats. Breakingviews imagines a consultant advising the board on picking his successor.

Regulators will drive next wave of EU bank mergers

27 December 2017

Past disasters, fragmented rules and limited cost savings rightly make European lenders wary of cross-border deals. The European Central Bank, however, is eager to see fewer and bigger banks in the euro zone. Mergers will please regulators more than shareholders.