Outlook

The expected timing and extent of interest rate cuts by central banks are set to drive financial markets in 2024. Inflationary pressures continue to ease and markets are already discounting lower rates by the end of 2023. Nevertheless, the Fed and ECB may err on the side of caution and proceed cautiously in easing their policy rates amid tight labour markets and resilient wage growth.

In this context and in line with the priorities set out in the Lifetime Partner 24: Driving Growth plan, in the Life segment the Group continues to execute its strategy to rebalance the Life portfolio to further increase profitability and allocate capital more efficiently. It will also maintain its focus on product simplification and innovation, with the introduction of a range of modular product solutions that are designed to meet customer needs and are marketed through the most suitable and efficient distribution channels. Primary focus areas include protection and health, as well as capital-light savings.

In the Property & Casualty segment, the Group's objective is to maximize profitable growth - with a focus on the non-motor line - across the insurance markets in which it operates, strengthening its position and offering especially in countries with high growth potential.

The Group confirms and strengthens its adaptive approach towards tariff adjustments, also considering the increase in reinsurance coverage costs due to the increased natural catastrophe claims in recent years. The growth of the P&C segment will continue with the aim to enhance its leadership in the European insurance market for private individuals, professionals and small and medium-sized enterprises (SMEs) and also thanks to the recent acquisition of Liberty Seguros, operating in Spain, Portugal and Ireland.

In the Asset & Wealth Management segment, Asset Management will continue to implement its strategy with the objectives of expanding the product offering, particularly in real and private assets, enhancing distribution capabilities, and extending its presence in new markets. This strategy will also be supported by the acquisition of Conning Holdings Limited and its affiliates, which is expected to be completed by the first half of 2024. In Wealth Management, the Banca Generali group will continue to focus on its targets of size, profitability and shareholders’ remuneration as outlined in its strategic plan.

With reference to the Group’s investment policy, it will continue to pursue an asset allocation strategy aimed at ensuring consistency with liabilities to policyholders and, where possible, at increasing current returns.

The Group confirms its commitment to pursue sustainable growth, enhance its earnings profile and lead innovation. This is in order to achieve a compound annual growth rate in earnings per share¹ between 6% and 8% in the period 2021-2024, generate Net Holding Cash Flow² exceeding € 8.5 billion in the period 2022-2024 and distribute cumulative dividends to shareholders for an amount between € 5.2 billion and € 5.6 billion in the period 2022-2024, with a ratchet policy on the dividend per share. The Group expects to achieve the latter target by May 2024: more specifically, based on the assumption that the Shareholders’ Meeting on 24 April 2024 will approve the proposal of distributing dividends in 2024 for € 2.0 billion, cumulative dividends in the period 2022-2024 will be € 5.5 billion.