UBI Banca Q1 net sharply lower on write-downs

MILAN May 9 (Reuters) - Italian cooperative bank UBI Banca's (UBI.MI) first-quarter net profit fell sharply to 24.3 million euros from 219.3 million euros a year earlier, hit by extra write-downs, the bank said on Saturday.

Underlying activities were lower with operating revenues down 6.8 percent to 996 million euros, partly offset by a 2.6 percent fall in operating costs and continued synergies from integration of units, it said in a statement.

"The first quarter of 2009 reflected the continued difficult economic context, that has affected volumes, revenue generation and the quality of credit," it said.

The bank booked 75 million euros in write-downs, from end-2008 values, on assets classified as available for sale, including in particular stakes in Intesa Sanpaolo SpA (ISP.MI) and A2A SpA (A2.MI), it said.

"However, the value of such shares at the date of the present statement are substantially in line with the end-2008 value and would not require any correction," it said.

If the recovery underway is confirmed at end-June, the write-downs at the end of the first quarter could be recuperated under this accounting treatment, it said.

Excluding one-off items, net profit fell only 47 percent to 99 million euros, from a year earlier, and returning to profit after the loss of 102 million euros in the fourth quarter of 2008, it said.

In the first quarter, loan write-downs rose to 160 million euros from 60 million a year earlier, it said.

(Writing by Nigel Tutt; Editing by Sugita Katyal)