Italian bank Intesa Sanpaolo 3Q earns drop by half

Italian bank Intesa Sanpaolo 3Q profits drop by half on weak economy

Associated Press

MILAN (AP) -- Italian bank Intesa Sanpaolo SpA says third-quarter profits fell by nearly half due to lower interest income and lower profits on trading.

The bank reported net income of 218 million euros ($292 million) in the quarter, compared with 414 million euros last year. Operating income was flat at 2 billion euros.

Intesa, Italy's second-largest bank by assets, set aside 1.5 billion euros in loan loss provisions in the quarter. Provisioning for the first nine months was 4 billion euros, up nearly one-quarter on the year.

The bank said it strengthened provisions, despite stabilizing credit trends, to prepare for the upcoming European bank stress test. Intesa's Core Tier 1 ratio, a measure of a bank's health, was 12.1 percent, above European requirements.

Its shares dropped 2.6 percent to 1.72 euros Wednesday.

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