After having surpassed the targets of the previous plan over a year in advance, Banco BPM presents the 2023-2026 Strategic Plan.
The new Plan is based on 7 pillars for the support of clients and territory, with a better return for every stakeholder and a full integration of the strategic ambitions of sustainability and ESG initiatives. Here are the main points of the 2023-2026 Strategic Plan of Banco BPM.
1. Companies and PMIs toward green transition
Among the new features in service of the Corporate and Investment Banking segment there is the dedicated manager for key clients. The new model will start from a careful segmentation of the client pool and will also see synergy with Banca Akros, as well as the use of supply chain finance tools.
For small business clients, the focus is on the digital user experience, which will allow to use transactional services through dedicated apps and websites, as well as smart and digital lending products (for 2024).
Also coming soon is the digital branch dedicated to SMEs.
Profits are expected to grow on the segment, during the timeframe of the Plan, by around 270 million euros.
But it is with synergies that the Group aims for growth toward the green transition of its target business fabric. With Corporate & Investment Banking infrastructures, such as Structured Finance and Global Transaction Banking, as well as Banca Akros and Banca Aletti for solutions aimed at satisfying different financial needs.
The offer will be strengthened, with a model specialized on agribusiness in order to help enterprises optimize their carbon footprint, and the opening of new Enterprise Centers in the highest grow potential areas.
The new green financial aid to enterprises and the new financial aids in support of green industries (with low risk) will surpass 10 billion euros per year, compared to the almost 8 billion of the first 9 months of 2023.
2. WM and Life Insurance
The second pillar of the Plan is the managed and indirect collection, which will grow on the two principles of wealth management and life insurance.
The estimates look at 215 million in profit in 2026, of which around 110 from the indirect non-insurance related collection and 105 million from Vita, thanks to the redefinition of products and services offered.
The Group will therefore proceed with a dynamic and behavioral segmentation of affluent clients, with the goal of allocating almost 180K clients to Relationship Managers, who have the tools for a remote offer.
Moreover, artificial intelligence will come into play to customize the based on clients’ needs.
3. Strategic Partnerships
Banco BPM will be involved in maximizing the generated value of strategic partnerships up to 2026, which should return 95 million of additional profit.
Among these, the one with Payco/BCC Pay: the agreement will become effective from the first quarter of 2024, but it will extend the offer in terms of cross selling and up-selling, with joined marketing actions, to new client clusters, such as corporate businesses.
New partnership, coming within the year, in bankassurance with Crédit Agricole Assurance in both Credit Protection and non-Credit Protection. With plans to develop tools for customer insurance checkup and insurance gap assessment, to integrate the offering into WM's new platform, offering new evolved products through the partner and through the network of Bancassurance Specialists, already present on the territory.
4. Omnichannel
An acceleration project of digital sales and client onboarding will begin, thanks to the completion of the new marketing automation platform.
The digital marketing activities will be boosted, along with the expansion of the number of products that can be purchased online.
The goals aim to bring the quote of completely digital sales in 2026 up to 30%, instead of the current 17%.
Consulting is also omnichannel, with the ability to offer off-site advisory services by integrating WM's platform into the advanced CRM tool. With the target of 40% remote or out-of-office consultations before 2026 (instead of the current 23%).
Speaking of omnichannel, we look at another direct channel: the branch. The rationalization of the distribution network continues: phase out for 400 cash workstations and reduction of the number of branches to almost 1,250 in 2026, for 500 new evolved ATMs and the growth of the Digital Branch, born from the evolution of the Customer Center.
Anticipated 1,600 exits among staff, including through a leave incentive plan that is expected to start in 2024. But, with new entries: 800 high potential young people.
They also expect the reboost of Webank, in order to acquire new retail clients, particularly online. The relaunch will be also tied to the introduction of remote financial consultation through the Digital Branch and the reactivation of deposit remuneration offers.
5. IT Investments
600 million in IT Investments, in the next 3 years, namely a 20% more compared to the previous Plan, are focused on the full digitalization of the offer.
The work will focus on making the back-end more agile and performing through the cloud migration for the innovation of processes and using this technology for at least 60% of bank transactions on digital channels.
Investments also concern cybersecurity (+ 20% more compared to the previous Plan), to strengthen the offices, assure operative continuity, and bank resilience.
And then there is the hype of the moment, artificial intelligence that will be used to transform the way banking is done, thanks to advanced analytics, machine learning, and generative AI that will bring new revenues while containing costs and risks.
In the next 3 years, Banco BPM will present 30 AI use cases, and GenAI, supporting the business and efficiency goals of the operating machine.
New skills will also be needed: 200 new specialists profiles on key fields are expected in the Plan.
6. Asset strengthening
The Plan entails an additional strengthening of the asset profile of the group, with a risk cost up to 2026 of about 45 pb.
As for capital, the bank expects to reach, by the end of 2023, and maintain by the end of the plan, a CET1 ratio at around 14%.
7. Employees Empowerment
The new Plan will focus on change management initiatives, women empowerment and on customized professional evolution paths, promoting the exchange between generations and the generational turnover.
