Italian banks post record €46.5 billion net profit in 2024

Italian banks recorded a new all-time high in net profits in 2024, reaching €46.5 billion — up €5.7 billion (+14%) from 2023, according to a report by Fabi, the Italian banking union. Over the 2022–2024 period, total profits exceeded €112 billion, marking what the report calls an “exceptional three-year run,” largely driven by the European Central Bank’s high interest rate policy.

The report highlights a turning point in 2022. After a subdued period between 2018 and 2021, profits rose sharply: from €25.5 billion in 2022 to €40.7 billion in 2023 and €46.5 billion in 2024. Industry revenues reached €110.1 billion last year, up 7.2% from 2023 and 33.8% from 2018.

The return of interest rates has reshaped business models. Credit-related income now accounts for 58.5% of total revenues, overtaking commissions (41.5%), reversing a trend seen between 2019 and 2021. The interest margin has gained 17 percentage points in revenue share since 2022.

Commissions, after two years of decline, rebounded in 2024 to €45.7 billion (+12.4%), surpassing the 2021 peak. This was supported by a recovery in commercial activities like financial advice, asset management, and insurance distribution.

Credit quality remains strong: net non-performing loans (NPLs) account for just 1.5% of total loans, with a coverage ratio of 52.5%—well above the EU average. The share of “stage 2” loans dropped to 9.9%. Between 2023 and 2024, over €17 billion in NPLs were offloaded, helping balance sheets.

Efficiency and profitability indicators also improved: the cost/income ratio dropped to 53.2% (from 63.1% in 2022), and ROE rose to 13.3%—up from 9% in 2022 and just 0.9% in 2020.

Fabi General Secretary Lando Maria Sileoni commented that 2024 confirms strong profitability, with the interest margin still leading, but the rebound in commissions may signal a shift toward a new normal. He also warned against aggressive commercial practices by banks pushing risky financial and insurance products, calling for greater oversight to protect customers and employees.