MILAN (Reuters). Italy’s Banco BPM reported a better-than-expected first quarter net profit Thursday. This was due to a combination of lower loan writing downs and higher revenues.

Banco BPM (Italy’s third-largest banks) reported that it had a net profit of 177.8 million Euros ($187 Million) for the three-months to March. This is higher than the 131-million-euro estimate in a Reuters poll.

The first quarter revenues reached 1.186 billion euro, which was slightly higher than expected and an increase of 5.2% over last year. This is due to strong trading gains as well as buoyant net income.

Banco BPM stated that it will continue to lower risks. It also announced, as part of its strategy, the sale of 700,000,000 euros worth of soured loans.

As it is primarily focused on insurance and wealth management, the bank hopes net fees will become its primary profit driver.

It took full control of the French Covea joint venture for life insurance earlier last month.

Banco BPM can also exit from an existing insurance partnership that it has with Cattolica from January 1, 2023.

This is the main possibility. It’s possible to fully integrate the insurance company by the year 2023.

It will however evaluate the possibility of forming a partnership with other players after it has received expressions from leading actors such as Generali and Germany’s AXA (ETR) as well its main shareholder Credit Agricole. (OTC).

Credit Agricole was the largest investor in Banco BPM, with 9.2%. It stated that it wanted to expand the range of strategic partnerships between them. The current focus on consumer credit is what Credit Agricole claimed.

It sparked speculation of a potential full-scale acquisition. Sources close to the matter revealed that Credit Agricole told Italy’s Treasury last month it did not have a bid plan.

($1 = 0.9493 euros)