Financial performance
On
31st December 2010 the book value of the net assets of the
Foundations of banking origin amounted to €50.16 billion (up 1.4%
on 2009), accounting for 84.3% of total assets, or €59.5 billion (up 1.4% against €58.7 billion in 2009). These net
assets are divided between 88 organizations, widely varying in terms of size
and scope of operations. The 5 largest Foundations (accounting for 49% of total
net assets) are: Fondazione Cariplo, Compagnia di San Paolo, Fondazione Monte
dei Paschi di Siena, Fondazione Cassa di Risparmio di Verona Vicenza Belluno e
Ancona, Fondazione Cassa di Risparmio di Torino. It is
worth noting that the net assets of the 18 largest
Foundations
represent 76.8% of the total while the 18 smallest Foundations hold
little more than 1%.
Grouping the
Foundations by geographic area reveals that those located in Northern Italy
(47) hold capital to the value of higher than €34 billion, 67.8% of total net
assets. In particular, in the North-Western part of the country where 6 of the
18 largest Foundations are located, the average net assets are twice the
average of the system as a whole (€1,145 million versus €570 million). However
in Southern Italy and the islands where, for historic reasons there are only 11
Foundations, the average is recorded as €206 million, less than half of the
general average.
The
Foundations' banking investments amounted to €25.3 billion, representing 42.5% of total assets (against 40.7% in 2009). By the end of December 2010, of the 88 Foundations 18 no longer
held shares in their original spin-off banks, 55 had a minority holding; the
other 15 – who, in their group, represent 4.5% of the total funds of the
Foundations – held more than 50%, in line with the dispensation introduced in
2003 (art.4 DL no.143/2003 - amended by Law no.212/2003, which substituted
paragraph 3B of art.25 of DL no.153/99) for Foundations who either have a book
value of their net assets of up to €200 million or are operating in special
statute regions to be allowed to maintain control of their original banks.
Diverse
interest-bearing activities including financial instruments other than banking
investments, represented 52.6% of total assets equal to the sum of €31.3
billion
(€25.3 billion included financial assets managed directly or through third
parties; €6 billion invested in companies outside the original spin-off banking
companies); while property investment
accounted for 2.1% and special purpose companies for 1.4% of total assets.
The special purpose companies established
to carry out specific projects are functional in the realization of the
Foundations’ mission as are other investments in areas and for subjects whose
objectives are in line with those of the Foundations: these activities are
grouped under Mission Related
Investment. It seems appropriate at this point to remember – even if the
data refers to the movements in the period of 2009 – that these types of
investments, homogenous and productive in the pursuit of the mission of the
Foundations, arrive at about €3.33 billion with applications that extend from
investments in property development societies (including the Cassa Depositi e
Prestiti) to those both direct and indirect in motorways; airports and other
local infrastructures plus banks and ethical funds.
In 2010 the Foundations had ordinary revenues and gains of €1,986.3
million, reflecting a decrease of approximately 21.2% on the amount for the
previous year (€2,522 million). The Dividend income from the respective
spin-off banks (equal to €707 million) – with a percentage share of the total
revenues of 35.6% (26% in 2009) shows an increase of 47% on the previous year.
Regarding this data it would be well to remember that the banking groups of
Intesa San Paolo and Unicredit
did not issue any dividends and that the bank Monte dei Paschi di Siena paid
out about one sixth of the dividends distributed in 2008.
Investments
other than in the spin-off banks had a decrease in dividends (-8%) passing
from €268 million to €246 million. Portfolio management activities produced
€360 million (€509 million in 2009) while income from the other financial
instruments closed at €545.2 million (
€883.8 million in 2009).
The
average return on the Foundations’ net assets went
from 5.1% in 2009 to 4% in 2010.
The operational costs in this period were
10.9% of the total revenues.
Operating
surplus for the year accounted for 74.4% amounting to €1,477.2 million. Of this
surplus, 23.3% - equal to €344.1 million - was assigned to reserves (Mandatory
reserve + Value fluctuation reserve + Previous deficit cover), while 76.7%
equal to €1,133.1 million - was assigned to institutional activity.
Institutional Activities
For the institutional
activities relative to the year 2010, €808.4 million, provided from the reserve
funds accumulated during the previous years, was added to the sum of €1,133.1
million from the operating surplus producing a total of €1,941.5 million. In
this field, €1,366.6 million (€1,386.5 in 2009) has already been
allocated to philanthropic activities (€1,324.4 million for donations
already decided by the Foundations and €42.2 million for the special funds for
voluntary activities, Law no 266/91) while €574.8 million is assigned for
the funds destined to support future grants.
The
number of projects financed by the Foundations in 2010 reached 27,084, a
slight increase on the previous year (25,716 in 2009). The average amount
per project fell slightly to €50,459 (€53,914 in 2009) while the average number
of projects per Foundation was recorded as 308.
Sectors of Activity
From
the 21 “eligible sectors” (by law), 7 sectors
are focused on for the major part of their grant-bestowing activities by the Foundations. Based on
the funds allocated, the Art, cultural
activities and heritage sector was first, with 30.2% (29.4% in
2009). Within this sector, funding was provided mainly to Conservation and enhancement of historic buildings and archaeological
sites (accounting for 33% of the funds allocated to the sector); the
average amount of the individual grants was more than double the sector’s
average and a higher prevalence of private entities rather than public entities
was noted among the beneficiaries. The sub-sector labelled Initiatives to support artistic and literary productions came next
(18.1%), followed by the sub-sector Other
artistic and cultural activities (15.4%) covering a wide variety of
activities that cannot be classified elsewhere. The sub-sector Museum activities ranked fourth (6.6%)
and Visual arts fifth (5%), followed
by Library and archives (2.9%), and Publishing and other communication media
(1.5%).
The second sector chosen in 2010 was that of Social assistance with 12.8%
of the total (10.1% in 2009). The greater portion (90.5%) went to the
sub-sector Social services, followed
by Services for assistance in natural
disaster, civil protection and refugee assistance
(2.8%). Recipients included primarily the disabled (37.4%), the elderly
(24.1%), children (13.6%) and those with drug/alcohol dependencies (0.7%).
Other beneficiaries
(families at risk, people with no fixed abode, prisoners, etc.) received 20.6%.
The third sector was Research, receiving 12.6%
(14.2% in 2009). The sub-sector for Research and experimental developments in the
field of Natural and Technological Science received 32.6% of
the funds allocated to this sector while Medical Research and Development received
19.8% and Research in Social Sciences was given 3.2%.
In fourth place was the sector Education,
learning and training, with 10.8% of total funding (11.7% in 2009).
The main sub-sectors were: Higher
learning, i.e. university or equivalent education (37%); Primary and secondary education (31.8%);
Adult training (11.6%); and Youth development and training (9.8%).
Following very closely, in fifth place, was the sector for Voluntary activities, philanthropy and
charity” receiving 9.6% of total funding (10.1% in 2009). Of this amount,
the largest share (32.3%) equal to €42.2 million, was dedicated to Reserve
funds for voluntary organizations followed by Contributions to grant-making foundations and
other philanthropic charities (19.8%), i.e. funds allocated to such
entities as community foundations, and other non-profit entities that channel
resources to voluntary organizations. These sub-sectors were followed by the
sub-sectors: Charities (11.9%); Support for the development and living standards of poor
countries (8.9%); Promotion and support for voluntary organizations” (6.1%) and
Cultural
exchanges and international cooperation (0.5%).
The sixth sector selected was that of Local development
with 9.1% of the funds allocated (against 12.7% in 2009). This sector
includes projects for the Promotion of
economic development in local communities (62.3% of the total allocated to
the sector), social housing construction
(5.4%) and The completion of public works
or utilities (4%).
In seventh position was the sector for Public health, with 8.4% of the total (7.3% in 2009). Under
this heading we find sub-sectors including: Hospital services (67.5%), which
range from the provision of medical equipment to the implementation of specific
projects and the construction and restructuring of facilities; Other
health services (21.9%), ranging from home assistance to the ill to
support for the treatment of the terminally ill and the disabled.
Other sectors ranked far behind the above, accounting
altogether for slightly less than 6.6%
of the sums allocated. These comprised Environmental protection and quality, continuing to grow with a
slight increase in share to 2.5%
(1.7% in 2009); Family and related
values with 2.4% (1.1% in 2009), Sport
and recreation with 1.6% (1.4% in 2009). And lastly, Civil rights, Religion
and spiritual development, Crime prevention and public safety obtained overall
€1.9 million for a total of 117 projects.
Regarding
the choice of sectors for their operations, the grants policy of the
Foundations highlights the prevalent
tendency towards a high degree
of specialization. This means that the Foundations decided to concentrate
in one sector a sum equal to no less than 50% of total funding or no less than
60% of total funding in two sectors (medium specialization refers to the case
where about 30% of funding goes to one sector or about 40% to two sectors). In
this respect, the decisions adopted reflect the provisions of the law, which requires that the Foundations allocate at least 50% of the
resources available to no more than five sectors (the so-called “significant
sectors”) selected from among the “eligible sectors”. Each Foundation focuses,
on average, on 6.2 sectors (6.4 in 2009). The sectors with the largest presence
of Foundations are Art, cultural
activities and heritage and Voluntary
activities, philanthropy and charity (all 88 Foundations), Education, learning and training (83), Public health (73), Social assistance and Research (65).
Of the grant totals, the incidence of
those higher than €100,000 has increased to 74.7% (74% in 2009) while
those higher than €500,000 to 48.7%. The
allocation of sums of €5,000 or lower remains, more or less, invariable within contained limits that would be
difficult to surmount,
representing only 2.2% of the total allocated (2.1% in 2009). The long-term grants have
slightly decreased, both in their total values (from 11.4% of the total funding
in 2009 to 10.1 in 2009) and in their frequency (from 4.4% to 4.2% of the total
number of grants).
Beneficiaries
The recipients of the grants provided
by the Foundations are always private
non-profit organizations –
accounting for 64.9% of total funding (65.6 in 2009) and 66.8% of all projects
(68.1% in 2009) – or public institutions.
The principal private recipients included: foundations (naturally not the
Foundations of banking origins) who, with 26.9%
of total funding, confirmed their first position among the beneficiaries, both
public and private. The foundations
are followed by the Associations with
12.2%, of which 1.7% was devoted to socially-oriented Associations, Voluntary organizations (4.7%) and Social cooperatives (3.2%). A
significant share of grants was provided to Other
private organisations (17.9%), which also included religious institutions.
Among public institutions, who
received in total 35.1% of the total funding, local authorities were
the main recipients, with 19.3% of
the funds allocated (18.6% in 2009). Following with 14.6% of the funds (14.5%
in 2009) were Public recipients other than local authorities, including
schools, universities, healthcare facilities, institutions for the elderly and
charities, etc. Grants to central
government agencies remained stable at 1.2%.
Territorial Distribution
The
Foundations continue to focus strongly on their local communities: grants provided to the Foundations’ own regions accounted for the great
majority of the total (91.8% of total funding and 93.3% of total projects). As
to geographic distribution Northern
Italy received about 70% of total funding of which 36.9%
went to the North-West and 33% to the North-East; Central Italy
received 24.7%, while Southern
Italy and the Islands 5.4%.
Partnerships
Among
the projects that the Foundations share with other financial organizations a
particular emphasis has been lain, during the last few years, on those realized
in conjunction with other Foundations of banking origin, in a vista of a
coordinated system of operations and that are developed with a long-term view.
It is possible that this concept has come directly
from the Foundations who, between them,
decided to “form a consortium” or else it has matured in the ambience of Acri, these
are projects needing a deep breath, of great national impact, regarding which
the “communal” approach is seen as an essential factor for success because
on the one hand it allows the use of a common professional factor developed by
the individual Foundations within their own local territories while on the
other it encourages the growth of project efficiency and rationalisation. Where
we have the same projects being carried out separately by a number of different
organisations they may be exposed to the
risk of fragmentation and the loss of useful information, shared planning
allows the direction of strengths in a synchronised way and will have more
impact.
Last updated on 10 february 2012 