Mediobanca posts 78% net profit decrease

Italy’s investment bank Mediobanca posted today a 78% decrease in its annual net profit, mainly caused by further write-downs on the bank’s investment portfolio and by raised provisions against risky loans.

According to chief executive Alberto Nagel (pictured), the bank’s performance was hit by the sovereign debt crisis in the eurozone, which particularly affected the performance of the corporate and investment banking businesses.

Meanwhile, gross profits of the banking activities increased by 6% to €563m.

During the period, Mediobanca has also reduced its risk profile, decreasing by €2bn its equity allocation and increasing from €5.4 to €9.2bn the holding of sovereign bonds.

With the statement, Mediobanca, which is Italy’s biggest publicly traded investment bank, has also announced a dividend cut by 71%.

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