Capital management concerns an ensemble of policies and decisions necessary to establish capital levels that are consistent with the risks taken on by the bank. Banca IFIS Group is subject to the requirements of capital adequacy established by the Basel Committee in accordance with the rules set by the Bank of Italy. On the basis of these rules, at the consolidated level, the ratio between capital and risk-weighted assets must be at least 8%.

The activity of ensuring that such supervisory requirements and consequent capital adequacy requirements are respected over time requires fixed objectives to be set right from planning on. An initial check occurs during the process of allocating budget objectives: on the basis of the growth trends expected for loans, other assets and the income statement items, the risks are quantified and the compatibility ratios are then checked.

Adherence to capital adequacy requirements is achieved through a payout policy, the definition of strategic financial operations (capital increases, convertible loans etc.) and the management of loan commitment policies.

Over the course of the year and on a quarterly basis, monitoring of the level of adherence to supervisory capital adequacy requirements is carried out.

A further phase of analysis and control of group capital adequacy occurs every time an extraordinary transaction is planned. In these cases, based on available information regarding this transaction, the Banca IFIS Group takes measures to forecast the effect on capital adequacy ratios and to analyse possible actions that may prove necessary in order to respect requirements.

Transactions on treasury shares

The Shareholders’ Meeting of 29 April 2010 renewed the authorisation to buy and sell treasury shares, pursuant to article 2357 ff of the Italian Civil Code, as well art. 132 of Leg. Decree 58/98, establishing a price interval within which the shares can be bought, in this case between a minimum of 2 Euro and a maximum of 20 Euro, for a total amount of 20 million Euro. The Meeting also established that the duration of the authorisation is equal to 18 months from the date the resolution was passed.

At 31 December 2009 Banca IFIS held 1,961,478 treasury shares worth 14,413 thousand Euro (average carrying price 7.35 euro per share) and a par value of 1,961 thousand Euro.

During 2010 Banca IFIS undertook the following treasury share transactions:

  • it bought, at an average price of 6.46 Euro, 2,080,211 treasury shares worth 13,447 thousand Euro and a par value of 2,080 thousand Euro;

  • it sold, at an average price of 5.20 euro, 965,420 treasury shares worth 5,025 thousand Euro and a par value of 965 thousand Euro, realising losses of 1,275 thousand Euro which, in compliance with international accounting standards, were recorded under the capital reserves;

  • it paid to shareholders, as part of the dividend on profits for 2009, 1,061,084 treasury shares, at a value of 7.61 Euro, worth 8,073 thousand Euro, realising profits of 11 thousand Euro which, in compliance with international accounting standards, were recorded under the capital reserves;

  • on 1 July 2010, following the free share capital increase, Banca IFIS received an allocation of 213,832 treasury shares with a fair value of 1,101 thousand Euro. This value was taken in proportion from the treasury shares held at 30 June 2010.

The remaining balance at the end of the year equalled 2,229,017 treasury shares for a counter value of 13,498 thousand Euro and a nominal amount of 2,229 thousand Euro.