UBI Banca Group

y the “Company restructuring programme” launched by the Board of Directors on 16 th
February 2011 17 .
Performance by business sector
2011 2010 % change
Figures in thousands of euro number amount number amount number amount
Auto 2,901 109,671 5,745 223,580 -49.5% -50.9%
of which: - motor vehicles 1,685 52,731 3,240 103,752 -48.0% -49.2%
- commercial vehicles 732 17,117 1,560 36,237 -53.1% -52.8%
- industrial vehicles 484 39,823 945 83,591 -48.8% -52.4%
Machinery and equipment 1,639 169,521 3,351 328,832 -51.1% -48.4%
Aeronautical 54 17,081 242 93,689 -77.7% -81.8%
Property 335 339,370 731 794,155 -54.2% -57.3%
Energy 70 142,615 147 418,648 -52.4% -65.9%
Total 4,999 778,258 10,216 1,858,904 -51.1% -58.1%
The main points of the programme consisted of the following:
• a revision of the organisational structure, with a view to simplification and alignment with
the organisational design indicated by the Parent:
a Risk Control Service was introduced, on the staff of the Managing Director, consisting
of two functions (compliance, risk management and anti money-laundering);
in the commercial sphere, with effect from 1 st July 2011, the distinction between the
banking and the agent distribution channels was eliminated and replaced by two general
geographical areas (Northern and “Central and Southern”), with a subsequent drastic
reduction in the network of agents, which at the end of the year was composed of six
agencies for a total of nine agents compared to 85 twelve months before 18 . At the same
time the proactive presence of personnel in bank branches was increased in line with the
new distribution model – which came into operation on 1 st October 2011 – focused
almost exclusively on business with captive Group customers, with the main objective of
acquiring new customers on which to perform cross-selling activity through the network
banks;
the Credit Approval and Operations departments were reorganised and centralised;
• action was undertaken in the first half of the year to reorganise the structure of the
company and its lending processes as part of a specific “Revision of credit quality” project,
launched in 2010 with the objective of improving the credit quality of the company, in
consideration of the critical condition in which it lay. Measures which gradually became
operational included the following: the implementation of electronic credit authorisation
software (PEF Leasing); the introduction of new software to manage problem loans; the
revision of the automatic approval tools used for the non captive channel (Experian scoring);
the centralisation at the Company Credit Department of approvals for counterparties
classified as medium and/or high risk by the rating models used by the Group 19 ;
• the completion of a specific “Qualitative Self Risk Assessment” project designed to identify
the main operational risks, the relative risk management controls and possible future
policies to allow the Company to correct the failings found.
As concerns the balance sheet, lending to customers over twelve months fell to €9 billion (-€0.7
billion; -6.7%), while within the item, the proportion subject to securitisation as a result of
transactions relating to UBI Lease Finance 5 increased by approximately 45%.
17 These initiatives were decided independently by the UBI Banca Group. UBI Leasing was never subject to specific inspections, but it
was involved, together with the Parent and the network banks, in inspections conducted between February and July 2010, designed
to assess the profile of the Group with regard to the management, governance and control of credit risk in the corporate customer
segment.
18 On 16 th February, the Board of Directors of the Company revoked the general powers of attorney conferred on its agents, with the
exception of area chiefs. The new commercial model was communicated by registered letter in April, as a result of which, from 1 st
October 2011 the UBI Leasing agents no longer provide assistance to banks and receive a commission if they find new business with
the Group’s network banks. Almost all the agency contracts were terminated in 2011, with specific provisions made in the accounts
for indemnities which may be due (€2.4 million).
19 At the same time that those initiatives were introduced, further action was also taken to set reference prices for the various markets
and products and the minimum prices applicable on the basis of the 2011 budget and to reorganise the structure of regulations for
Company processes and procedures and the relative manuals in order to protect the Company from incurring operating losses
which are not connected to business risk profiles.
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