UPDATE 2-Mediobanca to resume dividends after profit tops forecasts

(Adds quotes from newswire call, details, photo)

MILAN, July 29 (Reuters) - Italy’s Mediobanca on Thursday pledged to resume paying dividends after reporting a stronger-than-expected profit for its fiscal year ended on June 30, and said it was looking to expand its network of financial advisers.

Following the acquisition of alternative credit manager Bybrook earlier this year, Mediobanca said it continued to scout for opportunities to grow its wealth management business.

“Strengthening the distribution network and (the network of) financial advisers is interesting for us”, Chief Executive Alberto Nagel told a newswire call.

Mediobanca is bidding for Deutsche Bank’s financial adviser network in Italy, according to a source close to the matter.

The bank said it planned to pay out as dividends 70% of net profit, or 0.66 euros per share, while also buying back up to 3% of its share capital following the European Central Bank’s decision to end curbs on earnings distribution on Sept. 30.

It confirmed a 70% cash payout also for the current financial year.

Net income grew 35% to 808 million euros ($959.5 million) in the 12 months through June, above an average analyst forecast in a consensus provided by the bank of 789 million euros.

A strong fee performance in Mediobanca’s wealth management and corporate and investment banking businesses offset a slowdown in consumer banking caused by the pandemic.

Nagel said that he expected consumer banking to recover in the current fiscal year with demand for credit seen returning to pre-pandemic levels.

Nagel shrugged off the latest changes in the bank’s shareholder base, which has seen a shake-up over the past two years as a group of long-standing investors unravelled.

Eyewear magnate Leonardo Del Vecchio, who in 2019 emerged as the top investor in Mediobanca, has been steadily lifting his stake, recently reaching 19%.

Francesco Gaetano Caltagirone, another Italian businessman, this month boosted his Mediobanca holding to a potential 5%.

Mediobanca’s management is “responsible for the running of the bank and is focused on this regardless of changes in the shareholder base”, Nagel said.

$1 = 0.8421 euros Reporting by Gianluca Semeraro, editing by Valentina Za and Steve Orlofsky