Italy's post office
Now might not be a great time to launch a financial services stock, but Italy’s national postal service — led by its booming banking unit — is gearing up for a float.
Having rewritten its history as a lethargic administration that could barely be trusted to deliver a letter in time, the post office was valued this year by investment banks at as much as 15 billion euros, said Sarmi. He declined to say which banks had provided the estimate.
That would make it Italy’s third-largest retail bank by market value at current share prices and is 50 percent higher than the estimated value Sarmi cited for the postal group more than a year ago.
And while billions have been wiped off banks’ market value globally by their loans to ‘subprime’ borrowers, analysts say the post office — which in a float would offer shares to both domestic and foreign investors — is a banking story that has succeeded by betting on the simple and safe.
Key to Poste Italiane’s business model has been a strategy of using its 14,000 outlets across Italy to offer bank accounts and loans, exploiting its reputation as a conservative player that has catered to pensioners and families for decades.
In 2006, about 67 percent of Poste Italiane’s revenue came from ventures outside mail.
“It’s not an exciting business but it’s profitable,” said Vetulli.
Poste Italiane has joined a broader trend of postal groups diversifying out of the low-margin mail business into more lucrative segments, as the rise of the Internet and email challenge the concept of traditional mail.
With banking also using electronic networks, postal groups have found it relatively easy to branch out — capitalising on numerous outlets that give them a market position other retail operators can only dream of, and an image of reliability.
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