MILAN, Nov 7 (Reuters) - Italian online bank and brokerage Fineco on Tuesday flagged a possible drop in its 2024 net financial income (NFI), sending its shares down 4%, after it suffered fresh deposit outflows as clients moved their cash into government bonds.
Fineco uses NFI as a key profit measure tracking both income from the gap in lending and deposit rates as well as income from its large government bond portfolio.
Fineco said it expected deposits to stabilise next year, after the offer of a new government bond aimed at small savers in October caused it to post a 909-million-euro ($970.27 million) drop in direct funding as Fineco customers bought 620 million euros of the new retail bond.
Fineco, which pays no interest on deposits, has been particularly affected by the competition government bonds pose to bank funding now that they again pay positive returns.
The Italian bank said deposits were expected to stabilise next year, adding it had changed its current account offer to retain or attract customers, hurting banking fees in the third quarter.
Chief Executive Alessandro Foti said investors had been questioning the bank about its sovereign portfolio, as risk premiums on Italian debt have been rising as Europe's economic outlook worsens.
Foti said some investors were considering under-weighing Fineco shares in their portfolios given to its exposure to Italian debt, adding the bank at present had no liquidity to invest and would not add to its sovereign portfolio.
($1 = 0.9369 euros)
Reporting by Valentina Za, editing by Alvise Armellini
Source: Reuters