By Mauro Orru

Mediobanca Banca di Credito Finanziario raised its shareholder distribution target and revenue forecasts for its next fiscal year after growth accelerated in recent months.

The Italian lender said it expects to return more than 4 billion euros ($4.13 billion) to shareholders between 2023 and 2026, above a previous forecast of 3.7 billion euros. That target includes cash and share buybacks.

Mediobanca also raised its revenue projection for the fiscal year to the end of June 2026 to roughly 4 billion euros, above previous guidance of 3.8 billion euros. Net profit for the year should exceed 1.4 billion euros.

The upgrade comes after Mediobanca Chief Executive Alberto Nagel highlighted faster growth at the bank. Net profit and revenue above analysts' expectations for its fiscal second quarter.

The lender reported a net profit of 329.7 million euros for the three months to the end of December compared with 259.9 million euros a year earlier. Revenue grew to 983.1 million euros from 866.9 million euros. Its common equity tier 1 fully loaded ratio--a key measure of capital strength--came in at 15.2% at the end of December.

Analysts had forecast a net profit of 307 million euros and revenue of 902 million euros, according to a market consensus provided by the company.

For the current fiscal year to the end of June, the bank said revenue would continue to rise, with fees set to grow at a low double-digit rate, and net interest income remaining resilient. The company is also forecasting earnings per share growth between 6% and 8%.

The better-than-expected second-quarter figures come weeks after Mediobanca rejected a $14 billion takeover bid from Banca Monte dei Paschi di Siena. The lender said that Monte dei Paschi's offer, which hadn't been previously agreed, was contrary to the interests of Mediobanca.

Italy's crowded banking market is in the midst of an M&A spree after several lenders made bids to acquire rivals. Last week, BPER Banca launched an all-share bid of roughly 4.3 billion euros to take over smaller rival Banca Popolare di Sondrio.

That offer followed UniCredit's takeover bid for smaller rival Banco BPM, which also rebuffed the approach and is itself seeking to buy asset manager Anima Holding.

Write to Mauro Orru at mauro.orru@wsj.com

(END) Dow Jones Newswires

February 10, 2025 12:58 ET (17:58 GMT)

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