Banco Popolare posts Q1 net loss on big loan writedowns
MILAN May 13 (Reuters) - Italy's fourth-biggest lender by branches, Banco Popolare, posted a net loss in the first quarter of the year due a jump in the amount of money it set aside to cover for bad loans, it said on Tuesday.
The bank's net loss of 19 million euros in the first quarter compared with a profit of 91.9 million euros a year ago. Banco Popolare said net writedowns on loans totalled 328 million euros, up 43 percent from the same period last year.
The surge in loan loss charges was in stark contrast to bigger rival UniCredit, which on Monday said its loan writedowns in the first quarter had fallen by 28.5 percent from a year earlier after a massive clean-up of its balance sheet in 2013.
Banco Popolare also said net impaired loans rose 3.1 percent to 14.4 billion euros from 14 billion euros at the end of December, highlighting how Italy's tepid economic recovery remains fragile.
The lender, which has just completed a 1.5 billion euro capital increase in preparation for a Europe-wide health check of banks, said its Common Equity Tier 1 ratio - a measure of financial strength - stood at 11.2 percent, including the share sale, well above the minimum threshold set by the European Central Bank.
DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.