The Strategic Plan provided for a substantial increase in remuneration to shareholders, up to a maximum aggregate total of €2.5bn over four years (2020-23), roughly 50% higher than the amount distributed over the previous four-year period (2016-19). The unforeseeable outbreak of the Covid-19 pandemic outbreak and the subsequent ECB recommendations have meant that the planned remuneration policy has had to be revised.
Following the ECB’s recommendations to banks asking them not to pay dividends, no dividend was paid by Mediobanca for FY 2019-20.
For FY 2020-21, in view of the recent regulatory provisions, the Board of Directors will submit the following proposals to shareholders at the Annual General Meeting to be held in October 2021, subject to authorization from the ECB:
- Dividend per share of €0.66, in line with a payout ratio of 70% as stated at the start of the financial year;
- Cancellation of up to 22.6 million treasury shares owned (already deducted from CET1);
- New buyback scheme (up to 3% of the share capital) aimed at performance share schemes, acquisitions and including the possibility of cancellation.
For FY 2021-22 a cash dividend payout of 70% is confirmed.
The revised distribution policy will enable Mediobanca to:
- Maintain rating levels at the highest levels among Italian banks;
- Consolidate Mediobanca’s position as one of the best-capitalized European banks, a key factor for Corporate & Investment Banking and Wealth Management activities in particular;
- Have funds available in order to finance growth, both organically and via acquisitions.