Welcoming Italian Baking to the GCC - Welcoming Italian Baking to the GCC

Modern day banking can be traced back to Renaissance-era Italy. It should therefore come as no surprise that when UBI Banca recently opened its first GCC branch in Dubai, the move was met with pomp and circumstance. Supervisory board chair Andrea Moltrasio talks about the company’s growth plans, the expansion of Italian businesses in the UAE, and handling money in a characteristically Italian style.

 

THE UAE REPRESENTATIVE OFFICE IS YOUR THIRD INTERNATIONAL OFFICE IN THE LAST SIX MONTHS. WHY IS UBI BANCA INV ESTING SO MUCH IN AN INTERNATIONAL PRESENCE NOW?

If we wish to deliver added value to our customers today, we need to operate with the reliability of a bank and at the same time think with the speed of any other business. The UBI Group operates in the most economically active areas of Italy and therefore also of Europe with almost 80% of its loans concentrated in Lombardy, Piedmont, and Latium, three regions which produce around 40% of Italian gross domestic product. As a consequence, these areas contain a particularly high presence of the most dynamic companies which in recent years have geared up to expand their marketing and production on international markets in order to overcome the crisis experienced in Europe. These are businesses that not only require conventional services and lending from their banks, but also ask them to act as a partner to help analyse foreign markets and develop their own international presence.

 

YOU SIGNED AN MoU WITH ETIHAD ENERGY SERVICES. WHAT DOES THIS AGREEMENT GIVE BOTH PARTIES (UBI BANCA AND DEWA)?

The subject of energy efficiency is currently of huge economic and cultural interest in Europe. A prime example of this is the “Covenant of Mayors” with which European Mayors have set themselves a target to reduce CO2 emissions by at least 40% by 2030. Italy is the country with the greatest market potential in the field of retrofit programmes, with investments over the next five years forecast at between €55 billion and €75 billion. As a result, it has a number of specialist companies with the capacity to participate in the Dubai Clean Energy Strategy 2050 Programme projects. I would therefore say that the capacity of DEWA and its subsidiary to implement projects combines well in this case with the specific specialization and experience of a large number of UBI Banca’s corporate clients.

 

WHAT PROGRESS HAVE ITALIAN BUSINESSES MADE IN TERMS OF GROWTH IN THE UAE? WHA T SECTORS ARE THEY MOST PREVALENT IN?

Approximately 600 Italian firms are already active in the UAE (compared to 200 five years ago) making the UAE the main market for Italian exports to the Arab world. In 2014, UAE imports stood at around $185 billion and approximately 30% of the manufactured goods imported came from leading “Made in Italy” sectors: gold & jewellery, fashion & clothes, furniture & household goods, industrial machinery, mechanical products, construction materials, electrical and electronic equipment, and foodstuffs. Economic interest in the area grows even further if we consider plans to develop the country’s infrastructure by the Emirate government, in light of major events in the pipeline such as the Expo 2020.

 

IN WHAT WAYS DO YOU THINK YOUR BANK CAN BENEFIT THE COMMUNITY HERE?

As mentioned, we are seeing the growing importance of the Emirate’s economy to our manufacturing sector. Italy is the second largest manufacturing economy in Europe and since about 2008, exports have become progressively more important to its recent growth. The size of the projects and the capacity to implement them which Dubai has demonstrated with its public and economic institutions represent a guarantee for our companies.

 

HAVE EUROPE’S CURRENT FINANC IAL DIFFICULTIES BEEN TOUGH FOR BANKS LIKE UBI BANCA? HOW HAVE YOU TRIED TO RECOVER?

Since November 2014, UBI Banca, together with other major European banks, has become one of those credit institutions subject to single supervision by the European Central Bank. Before that occurred, an “Asset Quality Review” was conducted and the results underlined UBI Banca’s sound capital strength as a leader in the sector. This situation was also confirmed by recent financial data with a phased-in Common

 

Equity Tier 1 Ratio of 12.08%. It is therefore 283 basis points higher than the minimum requested by the ECB. While capital solidity is confirmed, the economic crisis has clearly had an impact on profitability, but the situation is showing signs of recovery and the last set of financial statements shows growth in the Group’s ordinary profitability with consolidated net profit net of non-recurring items of €195.1 million, up 33.2% compared with €146.5 million in 2014.

 

YOU ALSO HAVE A NONPROFIT SECTION. CAN YOU ELABORATE ON THAT, PLEASE? WHA T OTHER INITIATIVES DOES YOUR BANK HAVE?

In 2010, the UBI Banca Group set up an organizational unit that specializes in relations with customers in the non-profit sector and one year later the Bank launched “UBI Comunità”, a special set of services which comprises a range of products and services specifically designed to meet the particular requirements of third sector organisations.

 

Between April 2012 and March 2016 the UBI Banca Group issued 74 UBI Comunità social bonds for a total value of over €771 million. These have made it possible to make charitable donations of over €3.7 million designed to support initiatives of social interest and they have been subscribed by over 27,000 UBI Banca Group customers. The degree of involvement, as well as the numerous awards received, demonstrate that for some years now the third sector has become an indispensable player for the functioning of mature western economies.

 

FOR EXPAN DING IN THE MIDDLE EAST, ARE THERE ANY LOCA L BANK ING PRACTICES THAT YOU WISH TO ADOPT?

The main goal is to help our companies to increase their business in the Middle East and in all those countries in which UBI Banca has a presence exclusively with representative offices.

 

By following this approach, our office in Dubai can provide current and potential customers with all the information they need on the support they can obtain from the UBI Banca Group. This support provided to businesses is also implemented through selected and constructive relationships with major local and international banks and with those that specialise in corporate finance in particular.

 

About Andrea Moltrasio

ANDREA MOLTRASIO is the Chairman of the Supervisory Board for UBI Banca since April 2013. Until spring 2013 he held positions as CEO of Icro Coatings and Clinica Castelli. He is currently Non-Executive Chairman of Clinica Castelli. From 2005 to 2010, he was Vice Chairman of Confindustria Nazionale (National Confederation of Industry), in charge of relationships with Europe and the European Union. Confindustria is the main association representing manufacturing and service companies in Italy, with a voluntary membership of more than 150,000 companies of all sizes, employing a total of 5,434,352 people. Prior to that he has held the position of Chairman at the Unione degli Industriali di Bergamo from 2001 to 2005. He was Cofounder of Bergamo Scienza in 2003, where he was Chairman until 2013. He was a Member of the Board of Directors of Banca Popolare di Bergamo from 2003 until 2007 and a member of the Supervisory Board of UBI Banca from 2007 until 2010, and its its Management Board from 2010 until 2013. Andrea became the Chairman of the Board of Directors of Centrobanca from 2010 to 2013.

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