Annual Integrated
Report 2022

The reaction of bond markets to the new scenario of geopolitical tensions, inflationary pressures and restrictive monetary policies was disruptive, with double-digit losses in the global credit market, first and foremost in the United States and in Europe. Pressures also hit stock markets, recording the worst year since 2008 for Wall Street and since 2018 for Europe.

Despite the difficult context, which will find space in textbooks due to the extent of the crisis, Banca Generali was able to record solid financial results, with capital ratios and shareholder remuneration among the best on the Milan Stock Exchange. The Bank also reported solid commercial results, as confirmed by its positive net inflows. As evidenced by figures, the Bank once again proved the resilience and flexibility of its business model, the soundness of the decisions made in recent years to diversify and innovate its range of products and services, and the high-quality and experience of its Financial Advisor network, which, even in the most complex moments, succeeds in giving its best, standing out for the relationship quality offered.

At the beginning of last year — shortly before the outbreak of the market crisis — Banca Generali presented the 2022-2024 Strategic Plan to the Financial Community, with the explicit objective of continuing on the path of rapid, profitable and remunerative growth in line with the results obtained since its listing back in 2006, and in full keeping with its Vision of being the No. 1 private bank by service value, innovation and sustainability. The Plan is based on three pillars, which aim at increasing the value of the Bank’s service, both towards its Financial Advisor network and towards its customers. The second pillar focuses on the innovation of the business model with a view to building a data-driven, digital and open Bank. The third aims at strengthening the Bank’s sustainability stance to the benefit of all of its stakeholders. The Plan set some ambitious objectives in terms of consistent, profitable and remunerative growth, which the management team has confirmed, despite the deterioration of market conditions.

In terms of business expansion, net inflows reached 5.7 billion euros in 2022, and total assets stood at 83.1 billion euros, slightly below the record level reported for the previous year and proving highly resilient in the face of double-digit corrections in financial markets. The Bank’s net profit amounted to 213.0 million euros, with a lower contribution of variable fees linked to financial markets. Net of these non-recurring items, Banca Generali’s net profit rose by 25% for the year, thus exceeding the commitment it had undertaken with its stakeholders upon the presentation of the 2022-2024 threeyear Plan. In light of the foregoing, the Board of Directors has submitted a proposal for distributing a 192.8 million euro dividend, with a payout of 90.5% calculated on Banca Generali’s 2022 net profit, confirming its commitment to providing a generous shareholder remuneration, which is amongst the highest of those offered by the companies listed on the Milan Stock Exchange.

Despite market complexity and volatility, the Bank’s business expansion was driven by its intense activity, carried out through its Financial Advisors, who remained close to households in their protection choices. The hundreds of local events held by Financial Advisors in 2022, in addition to their intense daily activity, helped not only to keep customers informed of the most important themes in today’s investment scenario, but also, and above all, to provide an objective view of the financial context, avoiding first and foremost the risks triggered by personal emotional reactions to the strong shocks of the various asset classes. It is at the most difficult of times that the role played by professionals in supporting households comes clearly to the fore, as they keep the focus on goals and remain aware of the value of diversification and the risks of a limited, short-term vision. The Bank’s support — in the form of tools, analyses, research and thorough training of its Financial Advisors, which exceeded 60 hours per capita — was once again fundamental to consolidating the relationship of trust with customers, promoting dialogue and hence, ultimately, to growing the business. In this regard, I think it important to draw attention, once more, to the leading position achieved by the Banca Generali network of professionals in terms of portfolio size and expertise quality.

If the Bank’s numbers bear clear witness to its excellence, its strong efforts in pursuit of sustainable growth are also deserving of mention. Noteworthy sustainability improvements and efforts continued to be made in 2022, as borne out by the numerous recognitions received from the main ratings agencies in this field: a top rating was awarded by Morningstar’s agency Sustainalytics, which has recently ranked Banca Generali first in its world ranking for the sub-industry Asset Management & Custody Services, assigning a ‘negligible’ ESG risk rating to the Bank. Banca Generali also placed fifth in the ranking of the 97 retail and specialised banks analysed by Moody’s Vigeo-Eiris, thus confirming its inclusion in the MIB ESG Index. I would also like to mention that MSCI has raised Banca Generali’s sustainability rating from BBB to A. Equally important are the improved ratings received from Standard Ethics — from EE (Strong) to EE+ (Very Strong) — and ISS (Institutional Shareholder Services), which, for the Social category, awarded the Bank the “QualityScore Badge”, recognised to companies that have achieved the maximum score. In addition, the Carbon Disclosure Project (CDP) awarded Banca Generali a score of A- for its 2022 climate change reporting.

The awards received on the sustainability front — far from being a point of arrival — are actually the starting point for a renewed commitment to environmental, social and governance issues.

Banca Generali is, in fact, strengthening its commitment to the environment in general, and specifically to the fight against climate change, by promoting initiatives aimed at reducing direct and indirect environmental impacts. In particular, in 2022 the Bank started monitoring the carbon footprint of direct investments, with a medium-term reduction objective. A campaign was then launched to raise employees’ awareness of conscious use of energy resources (BG Smart Energy) and the operational refitting project continued at several branches and operating sites, with a more sustainable focus. Although the Bank was already in line with many pillars of the Principles for Responsible Investment (PRI), as in 2021 it had adopted Responsible Investment Policies — which introduced investment and lending restrictions for companies engaged in high climate impact industries and companies that obtain a significant share of turnover or electricity production from coal — it decided to become a PRI signatory in December 2022.

In the social dimension, the Bank has taken part in various initiatives, also alongside its Group, committing in particular to the care and development of its people, with a focus on well-being and equal opportunities, the development of quality investment solutions and the safeguarding of specific local features, enhancing its impact on the community.

In 2022, Banca Generali forged ahead with several Diversity, Equity & Inclusion (DEI) projects, among which the signing of the Charter “Donne in Banca: valorizzare la diversità di genere” (Women in Bank: enhancing gender diversity), promoted by the Italian Banking Association (ABI). Several other DEI initiatives were implemented: BG Forever Young, focused on young talent; BGeneration Month and BGenerAction, aimed at dialogue between the different generations within the Bank; BG Impact People and Women’s Empowerment, designed to enhance female professionalism and managerial skills. In 2022 as well, space was given to the younger generations, with over 60% of new hires made up of professionals under 35. On the employment front, Banca Generali confirmed the choice of the hybrid model ‘Next Normal’ for the entire employee population, so as to ensuring work-life balance.

As started some years ago, 2022 again saw a huge focus being placed on the theme of financial education, expanding the initiatives promoted in collaboration with FEduF (the ABI Foundation that promotes initiatives in primary, middle and high schools) with an innovative project — EduFin 3.0 — together with the well-known digital influencer Marco Montemagno, to simplify and make understandable the key concepts of savings, investments and IT tools governing the financial sector. The project, which is continuing in 2023, has had better than expected results, with millions of views reported by the events organised in the first months alone. The Bank’s branded initiative “Banca Generali – Un campione per amico” (A Champion for a Friend) has continued throughout Italy: for years, this event has been supplementing messages on the values of sport with financial education content thanks to the side project “Un salvadanaio per amico” (A Moneybox for a Friend), together with FEduF.

The Bank’s significant commitment to supporting institutions also continued, with collaborations with the various universities that ensure privileged access to research and innovation. With Milan Bicocca University, Banca Generali presented the first O-Fire Observatory report, developed thanks to the Bank’s promotion and support for research in the field of green finance and sustainable investments, with a particular focus in its first year on the EU Taxonomy and its implications for the industrial and financial sectors. The fintech-oriented agreement with Politecnico di Milano for the Blockchain & Distributed Ledger 2022 Observatory has been renewed, as has the agreement with Bocconi University on SME corporate governance, whose annual report has been much followed by the financial community and the business world. Worth of mention are also the traditional surveys on preferences and trends in private banking developed in partnership with LIUC University in Castellanza and Cattolica University in Milan. The Bank also benefits from close synergies with other institutions in Venice and Trieste, thanks to the preferential relationships within the Generali Group and the commitment of its local network.

In 2022, Banca Generali redefined the ESG attribute within its commercial approach and the wealth advisory service provided to its customers, adding to the ESG score the regulatory label pursuant to Articles 8 and 9 of EU Regulation No. 2019/2088. In this regard, I am glad to highlight the fact that 32.2% of the Bank’s managed solutions are composed of ESG products, both as direct investment and as underlying assets of financial and insurance investment solutions. This result demonstrates even more how Banca Generali’s commercial offer is permeated by the sustainability culture.

Banca Generali also recorded improvements in ESG governance, thanks to the addition to the Articles of Association that recognises the Board of Directors’ commitment to sustainable development and to its implementation in corporate strategies. In this context, a long-term programme of indepth ESG initiatives was also defined and launched, with a view to strengthening Board members’ competencies in light of constant changes in the regulatory framework, in line with the Bank of Italy’s supervisory expectations on the integration of climate-related and environmental risk in the management of financial institutions. The addition to the Articles of Association is in line with the process that has already introduced sustainability within the Managerial Steering Committee and provided for each of the Board Committees to assume responsibility within their respective purview. More generally, I would like to emphasize the fruitful dialogue between the Board of Directors and the company’s management, through regular inductions on topics of primary interest for the Bank’s development. During the year, internal control systems have also been further strengthened, with particular attention to the harmonisation of the Company’s control functions.

To conclude, I would like to emphasise how all these numerous activities and the quality of the results achieved have been made possible by the all-round vision and the shared values that unite the people of this extraordinary Bank. In this regard, I would like to sincerely thank all the Financial Advisors, Employees and Top Managers led by the Chief Executive Officer, as well as the other members of the Board of Directors, for their commitment, which has made it possible to face and overcome such a complex year from which Banca Generali has emerged even stronger, in the best position to continue on its three-year path and bring out its full potential.