A pen notebook and calculator laying on top of sheets of paper
Markets

David Herro Comments on Intesa Sanpaolo

Intesa Sanpaolo ( MIL:ISP ), an Italian retail and commercial bank, was the top contributor for the quarter, returning 16%. Intesa's fiscal-year results showed core revenue growth of 7%. We found these results impressive for an Italian bank, given that Italian GDP hasn't been growing, there is low banking penetration and the household savings rate is high. We believe Intesa's performance reflects management's focus on growing fee-based businesses. Asset quality continues to improve with non-performing loan formation at its lowest level since 2011, down 22% year-over-year, and management expects it to fall even further in 2015. Intesa's balance sheet remains very strong with a leverage ratio around 7%, one of the best in Europe, and its liquidity far exceeds requirements. Management has also announced a dividend increase, which will return additional capital to shareholders in 2015. We believe Intesa has a strong position and will continue to provide value for our shareholders.

From David Herro ( Trades , Portfolio )'s Oakmark International Fund 1Q 2015 Letter.

About GuruFocus: GuruFocus.com tracks the stocks picks and portfolio holdings of the world's best investors. This value investing site offers stock screeners and valuation tools. And publishes daily articles tracking the latest moves of the world's best investors. GuruFocus also provides promising stock ideas in 3 monthly newsletters sent to Premium Members .

This article first appeared on GuruFocus .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

Stocks

Latest Markets Videos