- CREDITI FISCALI
The Group's prospects for 2014 remain largely positive.
On the economic front, the recession that has characterised the years 2011, 2012 and 2013 seems to be easing, allowing for moderate, almost imperceptible growth in 2014 and 2015, even though there are still significant factors of instability. An indication of recovery, albeit modest, could inject the confidence into the system needed to stimulate the economy. The likelihood that production will quickly get back to pre-crisis levels is remote.
Against this backdrop, the Bank can count on sustainable margins thanks to the soundness and flexibility of its business model.
Operations in support of businesses could be positively influenced by the opportunities to acquire new customers and new loans, which will continue to be a focus for the Banca IFIS Group throughout 2014 and in the years ahead. A key factor in this initiative is the still scarce availability of credit to businesses, in light of the caution of non-specialist banks in supporting companies with traditional credit instruments. The performance will in any case depend on the trend in credit quality, a key variable for the banking market in challenging economic times. Should the promising signs of improvement in credit quality observed during 2013 be confirmed, it would noticeably bolster the Group's operations as far as lending to SMEs is concerned. This could both prompt the bank to step up its efforts and positively impact returns on loans net of credit costs.
As for loans in this sector, new opportunities are on the horizon as a result the on-going flow of payments from the Public Administration, particularly in the regions which had thus far suspended any further interventions. Furthermore, the Bank will continue to carry out specific actions aimed at helping companies deal with the new regulations on payments in the food industry, which became effective at the end of the previous year. The Bank will intervene to plug the financial gap of the companies that are now required to pay suppliers within 30 to 60 days, as opposed to longer payment terms in the past. Finally, the limited credit made available by lenders to business customers opens up new growth opportunities for the Bank in new promising market segments and channels.
As far as non-performing loans are concerned, the Bank will continue to pay attention to the several portfolios of receivables due from households that originators are expected to place on the market.
The focus on debt sustainability and the possibility of extending payments terms will most probably be crucial to boost the turnover and profitability of this business area, which operates in a social segment that has been badly hit by the crisis. In the near future, the Bank will pioneer innovative methods to allow an increasing number of households to start balancing their financial position gradually, also by taking advantage of new instruments and ever more accurate information on debtors.
As for the Tax Receivables sector, which is strongly dependent on the time it takes for the Italian Treasury to make payments, the Bank is actively acquiring often sizeable positions, given the good medium-term profitability of these investments.
In 2014 and the coming years, the Group will continue to develop its two new brands, Credi Impresa Futuro and CrediFamiglia, dedicated to financing companies operating in the domestic market and ensuring households settle their financial debts, respectively. Both brands will grow further thanks to their increasingly sophisticated web presence and, especially in the case of Credi Impresa Futuro, the fast ways to communicate with customers.
As for funding, the reduction in interest rates paid to customers due to market changes caused a further significant fall in the average cost of funding, and will continue to do so in the next quarters, as a result of term deposits with high interest rates coming to maturity. Funding has reached an outstanding level in absolute terms, and retail funding shall not increase further in order to prevent economic imbalances deemed unnecessary in the current scenario. The Bank believes that the stabilization of funding will characterise its operations in the near future.
The current trends in market rates are gradually making it less profitable for the Bank to continue purchasing government bonds. Furthermore, the portfolio has reached a decent size: the Bank expects to hold these bonds to maturity, thus robust returns are guaranteed for a significant period.
Therefore, the Group can reasonably expect a positive profit trend in the near future.