Mediobanca readies 385 million euros buyback after 24% profit rise

By Gianluca Semeraro

MILAN (Reuters) -Italy's Mediobanca will launch a share buyback programme worth around 385 million euros ($417 million), it said on Thursday after posting its best-ever yearly revenue and profit.

The bank posted a 24% rise in net profit to 1.27 billion euros, broadly in line with a consensus of analyst expectations provided by the company, on revenue up 9% at 3.6 billion, mainly thanks to the contribution of less capital-absorbing businesses such as wealth management.

It said it would pay a dividend of 1.07 euros per share, up 26% from last year.

The bank, whose financial year runs from July to June, reported an increase in earnings per share of 27% and reiterated a target for 15% compound annual growth in earnings per share set out in its three-year strategic plan to 2026, though for the current year it sees EPS growth of between 6% and 8%.

The plan's target "is confirmed", Chief Executive Alberto Nagel told a media call.

Analysts at Citi noted the share buyback was well above expectations.

In a statement, Nagel said: "The scenario for the coming months looks uncertain, due to the geopolitical and macro trends, and will require banks to be able to turn the expected volatile environment into opportunities.

"Mediobanca is in a privileged position on the back of its specialised business model."

For the current financial year, Mediobanca sees low double-digit growth in fees and low single-digit growth in net interest income.

Shares in the bank were down 1.3% in early trade against a 2% fall in the banking sector.

($1 = 0.9237 euros)

(Reporting by Gianluca Semeraro; Editing by Alvise Armellini and David Holmes)