The organisational structure

The model for segment reporting is in line with the organisational structure used by the Head Office to analyse Group results and is broken down into the sectors of Trade Receivables, Non-Performing Loans, Tax receivables, Governance and Services.

Here below are the results achieved in 2011 by the various business sectors, which will be analysed in the sections dedicated to the individual sectors.

Those results cannot be compared with the data for 2010, as 2011 is the first year in which the Banca IFIS Group, also in the light of the acquisition of the Toscana Finanza Group, defined the scope of its operating sectors as presented in this report.

In order to allow a comparison with the 2010 data, a 2011 income statement relative to the Banca IFIS Group's scope prior to the acquisition is presented at the end of the Trade Receivables section.

The Non-Performing Loans and Tax Receivables sectors, which were added to the Group’s scope after the acquisition of the Toscana Finanza Group, contributed to the profit as at 31 December 2011 starting from 30 June 2011, the date on which the business combination formally took effect.

 

(in thousands of Euro)

 

YEAR 2011

 

 

YEAR 2010

 

EQUITY

 

OF WHICH PROFIT FOR THE YEAR

 

 

 

EQUITY

 

OF WHICH PROFIT FOR THE YEAR

 

Parent company balance

196.820

24.943

 

 

205.692

17.149

Differences compared to the carrying amounts of the companies consolidated line by line

(538)

1.592

 

 

921

1.477

- IFIS Finance Sp. Zo.o.

(606)

1.524

 

 

921

1.477

- Fast Finance S.p.A.

(21)

(21)

 

 

-

-

- TF Sec S.r.l.

89

89

 

 

-

-

Group consolidated balance

196.282

26.535

 

206.613

18.626

 

INCOME STATEMENT DATA (in thousands of Euro)

 

TRADE RECEIVABLES

 

NPL

 

TAX RECEIVABLES

 

GOVERNANCE AND SERVICES

 

ELIMINATIONS AND ADJUSTMENTS

 

GROUP CONSOLIDATED TOTAL

 

Net banking income

73.837

8.601

2.712

36.303

-

121.453

Net profit from operations

43.322

8.016

1.669

36.303

-

89.310

 

STATEMENT OF FINANCIAL POSITION DATA (in thousands of Euro)

 

TRADE RECEIVABLES

 

NPL

 

TAX RECEIVABLES

 

GOVERNANCE AND SERVICES

 

ELIMINATIONS AND ADJUSTMENTS

 

GROUP CONSOLIDATED TOTAL

 

Available for sale financial assets

 -

 -

 -

1.685.163

 -

1.685.163

Due from banks

 -

 -

 -

315.897

 -

315.897

Due from customers

1.630.792

94.383

67.089

16.046

(85.829)

1.722.481

Due to banks

 -

 -

 -

2.001.734

 -

2.001.734

Due to customers

 -

 -

 -

1.657.224

 -

1.657.224

Trade receivables

This item includes the activities performed by the structures dedicated to the brands:

  • Banca IFIS, dedicated to supporting the trade receivables of SMEs operating in the domestic market;

  • Banca IFIS International, for companies growing abroad or based abroad and working with Italian customers;

  • Banca IFIS Pharma, supporting the trade receivables of local health services' suppliers

 

INCOME STATEMENT DATA (in thousands of Euro)

 

2011

 

Net interest income

(5.744)

Total net commission income

79.581

Net banking income

73.837

Net profit from financial activities

43.322

 

STATEMENT OF FINANCIAL POSITION DATA (in thousands of Euro)

 

31/12/2011

 

Non-performing loans

66.199

Substandard loans

79.185

Restructured loans

2.429

Past due loans

41.685

Total impaired assets due from customers

189.498

Net performing loans

1.441.294

Total due from customers (cash)

1.630.792

 

KPI

 

31/12/2011

 

Turnover

4.643.553

Net banking income/Turnover

1,6%

Net banking income/Due from customers

4,5%

Net non-performing loans/Due from customers

4,0%

Impaired assets/Due from customers

11,6%

Total RWA per sector

1.227.726

The following table shows the nominal value of receivables purchased (operating data not recognised in the statements) for factoring transactions existing at the end of the year (Total Receivables), broken down into receivables with or without recourse and receivables purchased outright. Please note that the breakdown of purchased receivables in the following table is based on the contract form used by the Bank.

 

TOTAL RECEIVABLES (in thousands of Euro)

 

BALANCES

 

 

CHANGE

 

31.12.2011

 

 

31/12/2010

 

 

ABSOLUTE

 

%

 

Receivables without recourse

146.464

 

 

180.458

 

 

(33.994)

(18,8)%

of which due from the Public Administration

10.976

 

 

10.216

 

 

760

7,4%

Receivables with recourse

1.496.402

 

 

1.421.495

 

 

74.907

5,3%

of which due from the Public Administration

464.710

 

 

408.452

 

 

56.258

13,8%

Outright purchases

480.115

 

 

461.061

 

 

19.054

4,1%

of which due from the Public Administration

397.412

 

 

291.924

 

 

105.488

36,1%

Total receivables

2.122.981

 

 

2.063.014

 

 

59.967

2,9%

of which due from the Public Administration

873.098

 

710.592

 

162.506

22,9%

The breakdown of customers by geographic area in Italy, with a separate indication for those abroad, and the breakdown of customers by product sector are as follows:

BREAKDOWN OF CUSTOMERS BY GEOGRAPHIC AREA

 

COMMITMENTS

 

TURNOVER

 

Northern Italy

42,2%

52,1%

Central Italy

30,6%

24,0%

Southern Italy

25,4%

14,4%

Abroad

1,8%

9,5%

Total

100,0%

100,0%

Here below are the pro-forma 2011 data compared to the year 2010 and relating to Banca IFIS Group’s scope before the acquisition of Toscana Finanza Group:

PRO-FORMA INCOME STATEMENT DATA ON A LIKE-FOR-LIKE BASIS(in thousands of euro)

 

YEAR

 

CHANGE

 

2011

 

2010

 

ABSOLUTE

 

%

 

Net interest income

30.738

27.293

3.445

12,60%

Total net commission income

78.871

66.844

12.027

18,00%

Income from trading, dividends and other revenues

531

293

238

81,20%

Net banking income

110.140

94.430

15.710

16,60%

Net value adjustments/revaluations due to deterioration of:

(30.515)

(24.444)

(6.071)

24,80%

a) receivables

(30.515)

(24.209)

(6.306)

26,00%

b) available for sale financial assets

-

(235)

235

(100,00)%

Net profit from financial activities

79.625

69.986

9.639

13,80%

a) personnel expenses

(24.258)

(25.176)

918

(3,6)%

b) other administrative expenses

(17.835)

(13.902)

(3.933)

28,3%

Net value adjustments/revaluations of plant, property and equipment

(1.250)

(1.330)

80

(6,0)%

Net value adjustments/revaluations of intangible assets

(1.468)

(1.153)

(315)

27,3%

Other operating income (expenses)

2.261

1.436

825

57,5%

Operating costs

(42.550)

(40.125)

(2.425)

6,0%

Gross profit for the year

37.075

29.861

7.214

24,2%

Income tax expense for the period

(14.178)

(11.235)

(2.943)

26,2%

Profit for the year

22.897

18.626

4.271

22,9%

 

CREDIT QUALITY

ON A LIKE-FOR-LIKE BASIS(in thousands of Euro)

 

BALANCES

 

CHANGE

 

31.12.2011

 

31.12.2010

 

ABSOLUTE

 

%

 

Non-performing loans

66.199

38.421

27.778

72,3%

Substandard loans

79.184

76.810

2.374

3,1%

Restructured loans

3.897

7.251

(3.354)

(46,3)%

Past due loans

41.685

98.446

(56.761)

(57,7)%

Total impaired assets due from customers

190.965

220.928

(29.963)

(13,6)%

Net performing loans

1.455.873

1.350.664

105.209

7,8%

Total due from customers (cash)

1.646.838

1.571.592

75.246

4,8%

Non-performing loans (NPL)

This is the division of Banca IFIS Group currently dedicated to non-recourse factoring and managing non-performing loans.

Toscana Finanza's business is by nature closely associated with extracting value from impaired loans. Therefore, even though most loans in the NPL division are included among non-performing and substandard loans pursuant to regulatory requirements, this classification is the logical consequence of the business model and does not represent the credit quality of the assets of the NPL division, whose activity is based on measuring those loans in the best possible way.

Consistently with the relevant legislation, NPLs are classified among substandard loans whenever the bank has not verified the debtor's state of insolvency.

INCOME STATEMENT DATA (in thousands of Euro)

 

2011

 

Net interest income

8.785

Total net commission income

(73)

Income from trading, dividends and other revenues

(111)

Net banking income

8.601

Net profit from financial activities

8.016

 

STATEMENT OF FINANCIAL POSITION DATA (in thousands of Euro)

 

31/12/2011

 

Non-performing loans

7.822

Substandard loans

78.913

Restructured loans

-

Past due loans

-

Total impaired assets due from customers

86.735

Net performing loans

7.648

Total due from customers (cash)

94.383

 

KPI

 

31/12/2011

 

Total RWA per sector

87.160

Nominal amount of receivables managed

2.460.234

Tax receivables

It is Banca IFIS Group’s sector specialised in purchasing tax receivables arising from insolvency proceedings; it offers to buy both accrued and accruing tax receivables on which repayment has already been requested or which shall be requested in the future, and that arose during insolvency proceedings or in prior years.

 

INCOME STATEMENT DATA (in thousands of Euro)

 

2011

 

Net interest income

2.722

Total net commission income

(10)

Net banking income

2.712

Net profit from financial activities

1.669

 

STATEMENT OF FINANCIAL POSITION DATA (in thousands of Euro)

 

31/12/2011

 

Non-performing loans

 -

Substandard loans

 -

Restructured loans

 -

Past due loans

 -

Total impaired assets due from customers

 -

Net performing loans

 67.089

Total due from customers (cash)

 67.089

 

KPI

 

31/12/2011

 

Total RWA per sector

37.917

Nominal amount of receivables managed

84.794

Governance and services

Within the scope of its management and coordination activities, the Governance and services sector exercises strategic, managerial, and technical-operational control over operating segments and subsidiaries. Furthermore, it provides the operating segments and subsidiaries with the financial resources and services necessary to perform their respective business activities. The Internal Audit, Compliance, Risk Management, Communications, Strategic Planning, Administration and Management Control, Organisation and ICT deparments, as well as the structures responsible for raising, allocating (to operating segments and subsidiaries), and managing financial resources are centralised in the Parent Company.

 

INCOME STATEMENT DATA (in thousands of Euro)

 

2011

 

Net interest income

36.482

Total net commission income

(710)

Income from trading, dividends and other revenues

531

Net banking income

36.303

Net profit from financial activities

36.303

 

STATEMENT OF FINANCIAL POSITION DATA (in thousands of Euro)

 

31/12/2011

 

Available for sale financial assets

1.685.163

Due from banks

315.897

Due from customers

16.046

Due to banks

2.001.734

Due to customers

1.657.224

 

KPI

 

31/12/2011

 

Total RWA per sector

147.142