Unicredit back in profit amid lending boost

Unicredit back in profit amid lending boost
Unicredit said it has boosted lending to households and small businesses. Photo: Gaetano Virgallito
UniCredit returned to profit in 2014, netting €2.0 billion $2.26 billion, Italy's largest bank said on Wednesday, while touting it had stepped up lending to households and small businesses.

"We have successfully completed the turnaround in Italy and we…considerably increased our lending to households," it said in a statement, adding that it had "been supporting the economies in all countries where the group is present."

Unicredit said it had already loaned to businesses most of the €7.8 billion in special funds it took from the European Central Bank that were intended to boost growth in the struggling eurozone by stepping up lending to companies.

The bank had hemorrhaged €14 billion in 2013 after writing down many of its assets ahead of "stress tests" carried out by the European Central Bank on the heels of the financial crisis.

Today, UniCredit is "one of the most solid European commercial banks," CEO Federico Ghizzoni said in the statement.

Despite the upbeat news, UniCredit's share price plunged 2.39 percent to €5.34 in otherwise flat mid-afternoon trading on Milan's FTSE MIB.

Annual turnover shrank by 3.5 percent to $22.5 billion, while costs declined 2.9 percent to €13.8 billion.

The bank said it would pay out a dividend of 12 euro cents per share, a rise of 20 percent.