October 25, 2018 / 10:45 AM / a year ago

Mediobanca's Q1 results beat forecasts

MILAN, Oct 25 (Reuters) - Italian merchant bank Mediobanca reported on Thursday higher-than-expected quarterly results helped by an expansion of its wealth management business.

The Milanese bank also said turmoil in Italian bond markets triggered by the profligate spending plans of Italy’s new anti-establishment government had little impact on its capital buffers in July-September, the first quarter of its fiscal year.

The bank’s best-quality capital ratio stood at 14.18 percent at the end of September under a transitory regime, compared with 14.24 percent at the end of June. Falling government bond prices accounted only for a 2 basis point change.

Italian banks have come under pressure because the spike in Italian bond yields hurt the value of lenders’ large sovereign holdings, eroding their capital reserves.

Mediobanca holds only 2.8 billion euros ($3.20 billion) in Italian bonds with a duration of 2.5 years.

Revenues rose 6.6 percent in the three months through September compared with a year earlier driven by rising net interest income and fees.

Net income came in at 245.4 million euros, well above a consensus estimate of 220 million euros provided by the company. ($1 = 0.8763 euros) (Reporting by Gianluca Semeraro and Valentina Za, editing by Agnieszka Flak)

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