Dividend

Dividend policy aimed at self funding business growth and paying excess capital to shareholders:

  • Target Total Capital ratio level of 15%, well above the SREP requirements
  • Earnings of the period retained to maintain the 15% Total Capital ratio target and pay-out the portion of the net income of the year in excess of the 15% TC ratio threshold
  • No obligation to pay a minimum DPS or pay-out ratio every year
  2016* 2017 2018 2019
DPS € 42.400 € 0.492 € 0.539 ~€ 0.415

Pay-out ratio (DPS/EPS**)

99.98% 87.59% 99.50% 76.02%
Cash dividends accrued in the year (€m) 72.13 83.69 91.75 70.87***
Ex-dividend date 13/03/2017 09/04/2018 01/04/2019 TBD

Average closing price of BFF share in the year

- € 5.383 € 5.293 € 5.063

Closing price of BFF share before ex-dividend date

- € 5.880 € 5.425  

Dividend yield (DPS/Average price in the year)

- 9.1% 10.2% 8.2%

Dividend yield (DPS/Price before ex-dividend date)

- 8.4% 9.9%  

 

* The number of issued shares was 1,701,074.

** EPS is calculated on the consolidated reported net income.

*** As indicated in the press release published on 6th August 2020, the Board of Directors of BFF acknowledged the recommendations issued, respectively on 27th and 28th July, by the European Central Bank and Bank of Italy, and the Frequently Asked Questions (FAQ) of the European authority, and, following a consultation with Bank of Italy, confirmed, as it did in March 2020, its dividend policy, adopting “Option 1” contained in the FAQ[1], and complying with the regulatory authorities recommendations to refrain from making any irrevocable commitment for dividend payments for the financial years 2019 and 2020.

In order to proceed as soon as possible, and within the context of the regulatory authority conditions, to the distribution of the 2019 Dividend, equal to €70.9m, BFF’s Board of Directors confirmed its intention to:

i) postpone the resolution to distribute part of Banca Farmafactoring S.p.A.’s 2019 individual profit for an amount equal to €12.4m, to an ordinary Shareholders’ Meeting to be held not prior to 1st January 2021;

ii) take all the necessary actions to allow, in compliance with the provisions of Art. 2433-bis of the Italian Civil Code, the distribution of additional €58.4m as interim dividends on the 2020 BFF’s individual profits for the 3Q 2020, in a Board of Directors to be held on the same day of the abovementioned ordinary Shareholders’ Meeting.

Both the aforesaid resolutions will be taken following a reassessment on the overcoming of the uncertainties caused by COVID-19 emergency.

Given the sound capital position of BFF, protected by a dividend policy that allows the distribution of the net profit only for the portion in excess of the 15% Total Capital ratio threshold (well above the minimum regulatory requirement), the low risk profile, and the resilience demonstrated by the business model, able to generate high value for its shareholders even in times of crisis, BFF is confident that it will be able to distribute the 2019 Dividend, in absence of further regulatory interventions, as soon as the banking authorities conditions are met. On this respect, in compliance with “Option 1” contained in the European Central Bank recommendation issued on 27th March 2020, the distribution of the 2019 Dividend does not reduce the quantity or quality of Common Equity Tier 1, because the relative amount has not been included in the regulatory capital calculation.


[1] In particular, the section 4 of the FAQ “Restriction on dividend and variable remunerations”: https://www.bankingsupervision.europa.eu/press/pr/date/2020/html/ssm.pr200320_FAQs~a4ac38e3ef.en.html.