Unipol Assicurazioni S.p.A. ($UNI)

Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Unipol conference call. At this time, I would like to turn the conference over to Mr. Matteo Laterza, CEO of Unipol. Please go ahead, sir.

Okay. Thank you very much for participating to this call. First of all, sorry for the delay. But as you can expect, it is a very busy day. This time, we will have the opportunity to present a transaction that, as you know, is in the context of the exchange and cash tender offer that Intesa Sanpaolo launched on Banca Monte dei Paschi shares this morning. In this extent, this transaction on one end, would find a definitive, hopefully solution on any possible roadblock that Intesa Sanpaolo could have coming from the antitrust authority. But on the other hand, would give Unipol a unique opportunity to realize an ambitious industrial project that is value creative since the beginning for our shareholders putting at work our capital and furthering our strategy as is the title of this presentation. And I will follow the presentation as a support of the comment that I will do in -- concerning the details of the transaction. When Intesa Sanpaolo cash and exchange public tender offer would be completed, Unipol will buy in cash for cash a substantial banking legal entity that will include the name Banca Monte dei Paschi. As you can see, on the presentation, the target as we have defined the bank that we will buy, we will take the name of Banca Monte dei Paschi and we'll have a quite defined perimeter, 635 branches. It is the perimeter that we defined with Intesa Sanpaolo agreement, of course when we will arrive to the settlement of the transaction, we'll define the exact number of the branches. That could be a little bit higher or lower depending on the requirement of the antitrust authority. We are talking about a bank that have something like 2 million of clients, 55 billion of direct deposits. 42 billion of net customer loans. And in these net customer loans, there are not nonperforming loans. The nonperforming loan component will be carved out from the perimeter and so we will take a bank clean of NPL. The total risk-weighted asset will be lower than EUR 20 billion. And the CET1 will be in the whereabout of EUR 3 billion. So we are talking about a bank whose CET1 is way above the average of the Italian banking industry. EUR 4 billion total book value and the total net income of the bank will be in the range between EUR 400 million and EUR 460 million. So we are buying a bank that is already profitable because if you compare this profitability to the book value of the bank, we are above of 10% of profitability on the book value. This bank, we will inherit 50%. First of all, 635 branches is more or less 50% of the total branches of the Monte dei Paschi. The rest will be taken by Intesa Sanpaolo and so it is quite normal that 50% of retail, wealth and corporate will be taken by us, by Unipol, and the rest will go to the rest of the branches. As I said before, the target will be free of any NPL, but also free from any insurance agreement. This means that Unipol will be able to distribute insurance products through the distribution network of the target since the beginning, since we will buy the -- take the ownership of the bank from Intesa Sanpaolo. And this is very important because this gives to us the possibility to start to do revenue synergies since the beginning by distributing bancassurance, insurance product through the distribution network of the target. The target will be clean also of the litigation -- legacy litigation existing of Monte dei Paschi, and as I said before, also of NPA. In the new bank, we will take a quite significant component of the corporate center because, as I said before, we are buying a self-standing banking, legal entity. And so consequently, we need all the corporate area that are necessary to -- that the bank can be managed independently as a stand-alone bank. For this, we will pay in cash, as I said before, and the total consideration have a cap that is EUR 3.5 billion. And so you are able to calculate the maximum multiple at which we will buy the bank by using this gap to the range of the net income that we will have at the final -- at the end of the process, EUR 400 million, EUR 460 million. As we have disclosed this morning in the press release, we will finance this transaction by doing -- executing a capital increase of EUR 2.5 billion plus existing cash resources that we already have. Of course, it is not -- as we have said in the press release, it is not in our strategy to keep this bank on a stand-alone basis. But our purpose is to propose to BPER a combination with the bank that would have the name of Banca Monte dei Paschi with the ambition on one end to create the second largest bank in our country in Italy, with a very strong geographical footprint and substantial synergies embedded in the combination of the 2 entities. And secondly, to allow Unipol to increase as a consequence of the combination, the sake in the combination by acquiring the control de facto of the bank. In doing this, as we have said this morning, we would not launch any tender offer on BPER share. As you can see in the slide today, we have a physical stake in BPER of less than 20%. On top of this, we have a position in derivatives. That today is 9.99%. So totally, we have a total exposure of less than 30% as a consequence of the combination of the target with BPER we assume but of course, it is our assumption, then the final stake will depend, of course, if BPER agrees in the offer on the relative value of the 2 entities when we will execute the transaction we will define the exact number. But today, we assume to take less than 10% -- more than 10% of the combination by reaching the -- an area of 40%. Of this 30% is physical, 9.99% remains in derivatives. But at the end of the process, our strategy is to build a big player, a big Italian player in insurance and in the banking group with the scale of EUR 40 billion. That is a big number comparing the number that we have today. This is the ambition that we have. It is our ambition that have a very strong industrial rationale that is based on the consolidation of the insurance business where we already are the #2 in the domestic market with a player in the banking business that will have the same ranking in the banking industry. The process is articulated in 2 steps. The first one concerns the acquisition of Target once the Intesa Sanpaolo cash and exchange tender offer will be completed, we will have the opportunity to buy a attractive player in the banking sector that will be the Banca Monte dei Paschi carved out of the perimeter that is in the interest of Intesa Sanpaolo that are the remaining branches plus the strategic stakes that they have in Generali and in Mediobanca and the other strategic stakes. As I said before, there is significant value creation potential since the beginning because, of course, we have estimated synergies when there will be the combination between the target and BPER but we can do synergies also since the beginning, of course, it is a very small component compared to what BPER can do with Monte dei Paschi but we can do a lot of things in -- for instance, in terms of selling bancassurance product through the distribution network of the target. As I said before, the target is clean of any legacy in terms of bancassurance contract because this legacy will be managed by Intesa Sanpaolo, so we will be able, since the beginning to sell Unipol insurance product using the distribution network of the new Banca Monte dei Paschi. We estimate EUR 2 billion in life and EUR 150 million in non-life. But it is not a first step. The most important part of our strategy. As I said before, the most important one is the second. The second consists in combining the target with BPER creating the second largest banking group in our country. And as a consequence of the combination of the 2 we will have, as I said before, a total consideration, a total interest exposure in BPER of almost 40%, 99.9% is the stake that we have today. then we will add the component that we get by the combination of the 2. We estimate more than 10 then the final terms we will be defined when we will start to discuss with BPER about the possible combination between the 2. And on top of that, we have also 99.9% of derivatives that today are derivatives, but tomorrow, a tower option can be transformed also in physical shares. That it is not the case today, but could be the case tomorrow. There is a minimum value creation for Unipol, but also for BPER shareholders because we estimate big synergies from the combination of the 2 entities. It is our estimation coming from Unipol. We are conscious that they are quite conservative. And we think that these synergies can't be lower than EUR 800 million. EUR 300 million coming from revenue synergies and EUR 500 million coming from cost. So it is a very important number. I'm quite confident that maybe BPER can do much -- also better than this. The new combination of the 2 banks that, as I said before, we will propose to take the name of Banca Monte dei Paschi. We'll have a very strong industrial footprint. We didn't see any significant overlap in terms of branches between where the branches of the target are and the distribution of branches of BPER. So if there is a quite strong complementarity between the 2 strong, a presence in the Italian country. We are talking about 2 million of client, that is the real value of the asset that we are buying. And in the combination -- through the combination of the 2, the combined entity will succeed in getting very important market share in very important regions where today they are not well represented like Veneto and Toscana, but there are many other counties where they will increase their market share. Globally, we expect the market share of the bank will be higher than 14%, becoming the second player in the domestic market. It will be a very long process because it will start after the completion of Intesa Sanpaolo offer, and there are -- we expect to complete the acquisition of the target within the first half of 2027 and to complete the full deal within the full year 2027. Then of course, we will follow the process day by day in order to see if we are on time or if we have to change some numbers. But of course, the Intesa Sanpaolo transaction is at the base of -- is the beginning, the completion of the transaction is the beginning of our process. This is a more detailed overview of the target. We are talking about less than EUR 2 billion of total revenues, EUR 800 million of net operating income, a profitability that is between EUR 400 million and EUR 500 million, so a very robust earnings base. And so it is an asset that since the beginning is profitable. And consequently, since the beginning, the transaction is accretive, of course, is accretive since the day in which we will take ownership of the target. In the meantime, of the capital increase execution and the taking ownership of the asset, of course, it is quite clear that there could be a sort of dilution in terms of EPS and DPS, but it is only a technicality that we will take a very few time lag before taking ownership of the asset. The capital position is very strong because we are talking about 16% of CET1 ratio and EUR 3 billion of capital, less than EUR 20 billion of risk-weighted asset. Today, we estimate something like EUR 19 billion and EUR 4 billion of book value. And the breakdown of the branches in our country is quite well distributed with 41% in the center. Of course, Tuscany has a big role in this representation. 25% in North and 34% in South. It is a very attractive retail platform. And as I said before, there are no significant overlap with BPER geographical footprint. Just to give you an idea on what in our approach is the evolution of BPER with the combination of NPS, BPER would become the #2 player in terms of direct funding, in terms of loans to customers and in terms of number of branches where you can see that if you compare the number of branches of BPER compared to Tier 1 and the loans of BPER compared to Tier 1 that are above Tier 1, but not in the same extent, then the difference in terms of branches, you can understand, and you can have an idea of the synergies that can be done in reorganizing the distribution network of the new bank in the future. In any way, the combination of BPER with the target. So the new name, the Banca Monte dei Paschi would become the #2 player in the domestic market, and it is a very -- with a market share of more than 14%, that is a real big number and give -- will give to the new bank the possibility to compete very strongly in our domestic market. In order to finance the transaction, as we have disclosed this morning, we will execute a right offering, an option to the existing shareholders. We already know that all except some of them because they didn't have time to do it. already expressed readiness to fully support their pro rata share. We are talking about 50% of the capital increase. That we want to execute within the year end, just to be prepared to apply for authorization of the new bank once Intesa Sanpaolo will be ready to manage the settlement of our transaction. As I said before, this capital increase is accretive in terms of earnings per share and dividend per share because we are buying an asset that have a profitability of more than 10% since the beginning because we are buying an asset that combined with BPER can create synergies of more than EUR 800 million. And by combining these 2 elements put together, we will be able not only to support our dividend distribution capability as it is today. but we are able to increase the dividend capability in order to maintain stable our commitment versus our shareholders with the target to assure to our shareholders a dividend yield that is in line with what we are paying today. But I will go and I will go in deep in this subject later on. We are buying a bank with a CET1 of 16%. As I said before, it is way above the average of the Italian banking industry. We will combine the target with BPER that has a CET1 of 14.8%, if I remember well. again, way above the average of the banking industry. The combined entity will be absorbed in the Unipol Group that has an insurance solvency ratio of 280% that is again at the high end of the solvency ratio of the insurance industry in Italy and in Europe, but by combining these three, one component, we will have more than 200% of solvency. These are the rules that have to be applied by Solvency II regulation. It is a number that is lower compared to 248 that we had today. But on one end, we put the capital at work in order to invest in a high profitable asset. And on the other end,, this you must be aware that is not comparable with the number that have our peers in the insurance industry because the banking component that start to be more and more significant in terms of contribution to the solvency is also much less sensible to the change of the financial parameters like BTP spread or equity or whatever. And so the sensitivity of this 200% to the change of interest rate, credit spread and BTP when the transaction will be completed will be much lower than it is today. So it is a very strong number in terms of possible sensitivity on financial market change in the assumption. As I said before, concerning the dividend, we said -- I said several times in the past that EUR 800 million was the floor for our industrial plan that will be completed in 2027. We are asking shareholders EUR 2.5 billion of capital on top of the EUR 15 billion that we capitalized today. And of course, we must remunerate the shareholders, the new shareholders or the present shareholders that decided to subscribe the capital increase. And as a consequence of that, this EUR 800 million floor will be changed in EUR 930 million that you see in this slide that become the new floor that we aim to pay to our shareholders since the P&L, the earnings that we will deliver for 2026 and then that we will pay in 2027. We are confident to be in the condition to do it. even if the target is expected to come at the end of 2027, but it is not an event that can change in any way this commitment. And we are confident also because we have a clear idea of what we will become at the end of the process. And you can see in this slide where we did 2 kind of estimate. First of all, what BPER earnings could become just as a consequence of the combination with the target, EUR 2.4 billion is the restated adjusted net income of BPER in fiscal year '25. We are apporting EUR 500 billion of the new entity, of the target Monte dei Paschi. And on top of that, you have EUR 500 million of net of tax this time of synergies that have to be added to the earnings of BPER. So at the end of the process, we expect to see a combined entity that is able to produce an earnings normalized of EUR 3.4 billion. Starting from this number and again, doing the same exercise on Unipol, we started from EUR 1.5 billion of Unipol net income. That is the number that we disclosed in 2025. Of course, there is the gain that we did on BPER transaction that is lower than EUR 200 million, but gives to you the idea of the total number that we did in 2025. As a consequence of the fact that our stake will be -- physical without the derivative, will be increased to more than 30%. That is our assumption. We will get EUR 400 million more and on top of that, our part of synergies that BPER will realize is in the region of EUR 200 million. Of course, we will share the rest of the synergies with the other shareholder of BPER. And this is the reason why we think that this is a unique opportunity, not only for Unipol, but also for BPER shareholders. As a consequence of this, we will arrive to a Group Unipol that have 100% of -- that have -- is the second player in the insurance business, but has a stake of more than 30% physical plus 10% derivative in the second player in the bank with a total net income, net of minorities, of EUR 2 billion. And this is the number that is subject to distribution -- possible distribution to our shareholders. So you can apply a very conservative payout or also an average payout that we, in the past, have distributed to our shareholders and you can understand which could be the possible or probable amount of dividend that we can distribute in -- when once this transaction has been definitively executed. So at the end, before opening the floor to the question, we are talking about the acquisition of very high quality and sizable target. And I can add at a reasonable price, this transaction will allow us to strengthen our business model. So it is -- as the title say, we are furthering our strategy. It is the prosecution of our strategy as a consequence of a unique opportunity that Intesa Sanpaolo gave to us to buy high quality and sizable target. We will become a fully integrated banking and insurance player. The dimension is in the region of EUR 40 billion. So it's a big player, number 2 in insurance. and also number 2 in the banking, Italian market. Of course, we will be able to expand our revenue base, both in bank and also in insurance because we will be able to accelerate our distribution capability in life and in non-life, I said several times in the past, how the bancassurance distribution network, the banking distribution network work is very important to feed the growth in terms of premium in life and in non-life. We can get also a greater diversification because life is very important when interest rates are low. Banking business give contribution in terms of profitability when interest rates are very high and life is -- do not perform in the same extent. And the non-life business being noncyclical is the bulk and will continue to be the bulk of our strategy. It is a transaction that support domestic banking consolidation. It is driven by Italian players, both in Intesa Sanpaolo Intesa side and also in Unipol side with core Italian shareholders is an Italian banking -- is Italian market banking transaction. And it has a very solid Italian footprint. So several times in the past, you made several questions on what we will do with what you define the excess capital and several times, I answered that if we will have the opportunity, we'll put this capital at work. We had this opportunity, thanks to Intesa Sanpaolo. And we think that is a unique opportunity that we have to exploit. There is a consequence in doing things and also in not doing things. If we would have give up to this opportunity Intesa Sanpaolo for sure, would have done the transaction with another player and we would have remained with an asset that is BPER Banca that would have had a less stronger footprint in the domestic market with a negative consequence on the value of our stake. So we didn't think any second or minute if this was a good opportunity to be exploited, and we decided to go ahead. Thank you for the time, and I open the floor to the questions.

[Operator Instructions] The first question comes from Antonio Gianfrancesco with Intermonte.

Congratulation for the announced. We are very, very amazing. My first question is on the BPER combination and on the de facto consol. Because you indicated that the structure should be functional to Unipol achieving a de factor consol over BPER without launching a public tender offer. . Okay. I was wondering if you could give us some color on the regulatory path from here to avoid to launch a tender offer considering a stake of almost 40%. And if I understood correctly, we should think about Unipol's economic rights on the combined entity at 30%, while maintaining a 10% additional exposure to derivatives. This was the first one. The second one is on the capital allocation, dividends and excess capital. I was wondering if you could provide us a few more details on how you assess the trade-off in terms of capital allocation underlying this transaction because the transaction is financed by EUR 2.5 billion and the available capital solvency will be above 200%. So you guided for EUR 30 million dividends in 2026. I will understand how this transaction changes the 2027 overall view in terms of dividend policy? Because for 2025, it amounted EUR 800 million. and at least EUR 930 million in 2026. So at this point, it is clear that the guidance of EUR 2.4 billion for 2025, 2027 does not make any sense. So what type of payout we should expect from 2027 onwards?

Thank you to you, Gianfrancesco. First of all, as I said, the combination will entitle us to increase our stake in the combined entity. Today, we are already with the physical and derivative a little bit less than 30%. So we will overcome the 30% threshold of the public tender offer, but being a combination that means a merger or a hive down in case the shareholder of BPER accept us, of course, that are interested to the transaction in majority give the approval of the transaction. That means to have the so-called white wash, we can go over 30% without launching a public tender offer. That is the only option that BPER have to arrive to the completion of the transaction. So it is the rule -- the Italian regulation in terms of public tender offer. In case of white wash, we will not launch a public tender offer. That is the only option that they have to get the merger. Otherwise, there will not be any kind of combination, just to be clear with you. In terms of capital allocation, as I said before, we have increased the so-called floor to EUR 930 million. since the distribution that we aim to pay in May 2027 because as we are already here, we are in the condition to pay this number. And then after the completion of the project, I showed that the perimeter of earnings of the group is in the whereabout of EUR 2 billion. So you are investors and analysts and are very smart to apply a dividend payout to this EUR 2 billion. But if you apply a very conservative payout of 50% that is very conservative, you can arrive to EUR 1 billion of capital distribution that could be considered sort of a new floor. So you can apply 50% or you can go above depending on your availability to distribute capital. But in any way, the 200% of solvency, as I said before, is not an issue. It is a very solid number. If you consider that this 200% -- above 200% is a much less a sensible number to the change of financial market situation. And this puts us in the condition to think about future distribution without any kind of worries concerning the trend of financial market.

The next question comes from Michael Huttner with Berenberg.

Fantastic. Yes, congratulations as well, what you said about yes, you didn't have to think. Two questions, if I may. One on the derivatives, I wasn't clear whether the plan is to keep them as derivatives or not. And what will the financial consequence if you were to apply it to kind of transform them into physical shares? The second is on the -- really silly question, but bear with me, the restructuring costs and how they would be funded. I understand that a lot of it would be in hands of BPER. So it's hard for you to speak on behalf of BPER. Maybe you can give a feeling for what it would mean at the level of Unipol. And then the third point, on the kind of bancassurance side, the EUR 2 billion and the EUR 150 million. Could you -- these numbers are actually quite low to me because I seem to remember that already you're way above that through BPER stand-alone as it is at the moment. And maybe you can share some of the less conservative views one could have of this part of the project.

The new one that we subscribed is convertible in physical. The first one is not convertible today, but in the future by changing the -- with the agreement of the counterpart, we can change the contract by allowing also in this case, to transforming physical. And we have the possibility to, in this case, to transform in physical whenever we decide to do it. Of course, we must have all the approvals of the regulator to increase our stake physically. But once we will have the control de facto of the bank, of course, there will not be this need. So it is not our -- in our intention to cancel but to keep them. And in case we will decide to convert, we will do it, depending on what will be our need in the future. Concerning the restructuring cost, of course, it is a number that will have to be managed by BPER when they will manage the synergies of the combination. We don't have an estimate of a big number in terms of cost. They are in the region of EUR 150 million, EUR 200 million at the maximum. So it is not a big number. As I said before, there are not big overlaps in the distribution network of BPER and the target. There are, of course, a quite significant component of revenue synergies. And on the EUR 500 million cost synergies, the cost that we expect, the one-offs are in the region of EUR 100 million and EUR 150 million. To be honest, I'm not sure to have understood the third question concerning the EUR 2 billion of -- the only EUR 2 billion that I remember are the estimate of the earning of Unipol Group that to you seem a little bit low. Sorry, okay, I understand. It is the bancassurance.

Yes, please?

Yes, you are. I think you are right. There are my colleague of the bancassurance department are always very conservative and didn't have time to make challenging with them. And I think that they can do much better than this.

Can I just maybe follow up the EUR 800 million synergies or the numbers you put in the slides, they are net of tax, right?

EUR 800 million are gross of tax and EUR 500 million are net. Also in this case, I have to say that my colleagues were quite conservative. I'm not proficient in the banking business. But just giving a look to the number, these things are conservative as well. But anyway, I'm sure that people can do much better than this.

The next question comes from Qian Lu with UBS.

Just a quick one on capital and solvency. So you guide to a solvency of above 200% post the transaction. Should we think of that as your medium-term comfort level even once the BPER combination is completed? And more broadly, what are the key drivers we should think about when bridging that to pro forma solvency post the bank's combination, particularly in terms of the SCR impact and the capital intensity of the banking business, please?

Yes. As I said before, this number is a consequence of the fact that it changes the weight of the banking risk compared to the Solvency I and having a very big number in terms of solvency, a little bit lower than 300%, the banking solvency ratio that is a sort of opposite of the CET1 ratio is much lower than that, but much less sensible to the change of the parameter financials and operating. And as a consequence of this, the total solvency ratio goes down. It's more cosmetic than substantial because at the end, this 200% is a much more solid number than at the -- in terms of sensitivity compared to the principal parameters. So we don't have a trigger. We never have a trigger, automatic trigger that we consider in order to decide or not to decide to do a capital distribution. But I can tell you that it is a very solid number that give to us any kind of worry in terms of capital distribution in terms of the number that I disclosed, the EUR 930 million with a future at regime floor at EUR 1 billion plus once the transaction is completed.

The next question comes from Andrea Lisi with Equita.

The first one is again on the synergies. I noted that the size of the part of NPS that you are integrated, you will acquire and that potentially will be transferred to BPER is not that different in size from but synergies are significantly higher. So should we reconcile that with the fact that probably the size of the corporate center which is transferred is much bigger or there is something else here? Or maybe there is also some level of conservatism on the side on your view? The second one is on impact on solvency, in particular, I would wonder if you can provide us some indication on the impact on solvency before the transfer of the target to BPER. And if there is any -- if you can provide us an indication on the impact on solvency that you would have if you decide at some point to convert the derivatives in BPER into physical shares?

Thank you to you, Andrea. First of all, concerning the synergies, you are right. Of course, the dimension is very close to Banca Popolare di Sondrio, but the impact of the corporate center of the new target is in a sort of sense larger that give to the combination, the opportunity to do more synergies. Of the EUR 500 million of cost synergies, EUR 200 million come from savings in administrative expenses and the rest come from possible synergies coming from the turnover of the labor cost in the corporate center. And then we have EUR 340 million of revenue synergies, of course, that go on top of the EUR 800 million. And we think that BPER can do also much better than this, I think, because there is a lot of value that can be created by combining the 2. Impact on solvency, of course, the decision to transfer the derivative in physical depend exactly on what the target of solvency in the future we have in order to -- of course, a calendar in which we can expect to convert physically the share. It will depend on the evolution of the organic capital production that we do -- we will do.

The next question comes from Michele Ballatore with KBW.

Yes. I have -- the first question is about the combination with BPER of the new branches. I mean what has been agreed so far? What would be and what has to be agreed, especially in terms of the transfer -- the subsequent transfer of the branches from Monte dei Paschi branches from Unipol to BPER? What will be roughly the terms expected there? Is dedicated capital increase from the BPER or what can you tell us? And the second question about the synergies. Okay. You mentioned about the cost synergies, but about the revenue synergies. I don't know if you can give us some indication of what you expect in terms of revenue synergies, some example, why you think they are conservative.

First of all, today, we didn't have any kind of talk with BPER. BPER is not involved in this transaction. This is a transaction between Intesa Sanpaolo and Unipol. We will start to discuss with BPER starting from today. And then we will set up the process. And I'm sure that they will hopefully agree with us with the opportunity that come from the combination. So there are no agreement or talk with BPER up to now. And concerning the synergies, the revenue synergies, we estimated some synergies coming from the alignment in terms of productivity in funding or with our clients. But anyway, then it will be BPER that we'll have to consider if this estimate is prudent, and they can set up another number that can be more challenging. But as I said before, we are just at the beginning of the discussion. These are all numbers that we crunched in Unipol, and we think that they are very solid.

The next question comes from Luis Manuel Grillo Prattas with Autonomous.

This is Luis from Autonomous. I have 1 quick clarification on the synergy guidance. Are those synergies on top of the ones guided by BPER in its sundry offer? Or is there like any overlap? And then my second question is basically like what will happen next. So essentially, you can stay at 40%, and you effectively have de facto control at BPER. In that context, why are you currently ruling out a full business combination between Unipol and BPER? What prevents you from moving towards a single and fully integrated bancassurance group rather than keeping the current structure? And then my final question is on BPER's EGM to vote on this possible deal. Can you confirm whether you can vote or do you need to essentially abstain considering there is the related party issues and also the whitewash procedure that you mentioned before?

Thank you to you. First of all, concerning synergies, yes, they are on top of Banca Popolare di Sondrio synergies. Of course, I am not in charge of BPER. So I don't know if there are overlap with the synergies in Sondrio but actually, I can't expect any overlap because Sondrio have their own cost and revenue synergies regarding the perimeter of Sondrio and the combination between the target and BPER is a completely different perimeter. So I don't think there is any overlap between the 2 and in case they are very small. The second question is the -- if I have understood the other green question on the reverse merger between BPER and Unipol that is not on the table. They would change radically the structure of the group, and it is not in our plan. Concerning the third one, yes, we will be able to vote the merger but in order to have the so-called whitewash, the General Shareholder Meeting must have the vote of the majority of the shareholder except as in case the merger will be executed, if there will be not the whitewash, no merger will be executed.

The next question is a follow-up from Michael Huttner with Berenberg.

Two on timing. And the last one on what you just mentioned, the whitewash. So could you give us an indication for the timing of the rights issue? The second, do you have a feel, and I know it really is more BPER than you, but again, on the synergies, for the timing of synergies. I would have thought a lot of it by 2030, but who knows? And then on the risk side, I was going to ask about regulatory risks, if there's any kind of regulatory risk coming up. But also thinking really, I mean, so unlikely, but if BPER votes against it, would you then be left with owning 2 banks?

Yes. First of all, we would like to execute the right issue within the end of the year. and concerning the synergies, of course, the assumption is that the synergies are completed after 3 years, starting from when the target will be included in the combination, that in our assumption is at the end of 2027. This means that the 3 years come to 2030. This is the -- it is an assumption and it is quite fair that you take 3 years to make all the synergies in terms of revenue and cost. Concerning the regulatory risk, we must ask the approval for the acquisition of the target and we must take the approval for -- and this is a condition precedent for the acquisition of the target from Intesa Sanpaolo. Once acquired the target, of course, we will ask to the regulator for the approval of the combination and this is another process that we will have to set up in 2027. Concerning number 4, in case of vote against, yes, we'll have a bank at 100% and the stake in BPER Banca. It is, as I said before, a very available value-creating asset. I'm not worried at all to be with 2 very valuable assets. And then we will see how to maximize the value of these 2 assets. I'm sure that we will create value anyway. Of course, the best case for us and also for BPER, I think, is to arrive to the combination. And frankly speaking, I don't see any roadblock to arrive there. But also in case of not realizing of this project, I'm sure that we will be able to create value anyway.

The next question comes from Marco Nicolai with Jefferies.

Quick question from my side. Just I was wondering if the terms for BPER will be aligned to the terms you have with Intesa. So are they going -- so is the valuation of the business going to be like EUR 3 billion, EUR 3.5 billion that you will pass to Intesa?

There are terms for the acquisition from Intesa and terms for the proposal of combination, there are 2 different things. We will see when we will arrive to the proposal, how we will value the asset. As I said before, we are buying an asset, a very attractive level. We will look forward to propose to BPER this asset at a very attractive level. If you calculate the multiple at which, of course, we don't know yet at which multiple we will buy the asset because it will depend on how much Intesa Sanpaolo will pay for the acquisition of Monte dei Paschi but anyway, we will pay a quite low multiple. So we are in the condition to propose to BPER the asset at a very attractive level and enough attractive to be sure that for BPER shareholders, they can't give up to this opportunity.

So is it going to be in line with what you pay eventually or there might be a difference?

As I said before, 1 thing is what we pay Intesa, and of course, it is a sort of floor, We will propose to BPER at the terms and conditions that are fair value of BPER. but anyway, very attractive for BPER shareholders.

[Operator Instructions] Mr. Laterza. there are no more questions registered at this time.

Okay. Thank you very much for taking time with us, and we will meet again in August for the first half results. Thank you. Bye-bye.

Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones. Thank you.