Intesa 1Q profits down 62 percent

Intesa 1Q profits drop 62 percent as bank amassed cash buffer against uncertainty

Associated Press

MILAN (AP) -- Italian bank Intesa SanPaolo says first-quarter earnings fell 62 percent due to lower interest income and higher loan losses.

The bank reported Tuesday a net income of 306 million euros ($397 million) in the first quarter, down from 804 million euros last year.

CEO Enrico Cucchiani said that the bank maintained an "extraordinary" cash buffer of 20 billion euros due to the "magnified uncertainties on the horizon," notably the crisis in Cyprus and political uncertainty in Italy. The conservative position was a main factor for the lower interest income, which dropped to 2 billion euros from 2.5 billion euros a year earlier.

The bank said its Core Tier 1 ratio, a key measure of a bank's health, had risen to 11.3 percent.

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