Good afternoon, and good morning to those joining us from across the Atlantic. Welcome to the UniCredit 2021 Strategy Day held in Milan. I'm Magda Płocińska, and I'm the Head of Investor Relations. Over the next 75 minutes or so, Andrea Orcel, our CEO, will present the strategic vision and financial ambitions for UniCredit. We will then take a 15-minute break, after which he and members of our group executive committee will answer questions from our virtual audience. Our Q&A session will last around 90 minutes. At any time during the presentation, you can submit your questions either through the UniCredit Strategy Day app or by emailing strategyday@unicredit.eu. We will also take questions from our analyst community during the Q&A session live via video or audio. We will end the event at around 3:00 P.M. CET.
Before we begin, please note the legal disclaimers in the presentation and press release, both of which are available on the investor relations section of the UniCredit website. A reminder to please make sure you follow the instructions on your invitation for the best viewing experience. Thank you, and without further ado, we'll commence with a video.
Welcome to Future Focus, UniCredit Strategy Day 2021. I'm here today to introduce you to the bank we want to build: a bank fit for today, fit for tomorrow, and fit for the future. I'm going to talk not just about our plan for the next three years, but also about our long-term plan to put UniCredit back in the top tier of European banks. That is our ambition. We will move out of a period of retrenchment and restructuring into an era of purpose, growth, and value creation. We will build UniCredit into the bank for Europe's future. As we emerge from the initial disruption of the pandemic, we're at a tipping point in our history. It has prompted us to question the way we live and work, how we use technology, and the way we treat the planet.
Armed with this information, we have the chance to rebuild our economies and societies for the better so that we are stronger than we were before, together. I believe, as I have always believed, that the financial sector has a crucial role to play in this transition. Banks should be deeply embedded in their communities. They should act as engines of individual and collective growth, helping all deliver on their potential. Somewhere along the way, our industry lost sight of that purpose. We lost the trust of the people we're supposed to serve. It's time to remedy this, to rebuild trust and be the engine of our continent's collective progress once again. We can only do that if we're delivering for all our stakeholders. For our shareholders, we have to build a business that is financially strong and successful.
The plan I am announcing today should leave no doubt about that. We announce a return on tangible equity of around 10%, annual net revenue growth of 2%, and a distribution of at least EUR 16 billion over 2021-2024, in spite of significant investment in our future. We will also galvanize our people, giving them back a business that is growing and winning, a common objective, and an environment and teams in which they can flourish; a business that they feel proud to work for, where they have been provided with the tools to really deliver for their clients. We will keep our focus on our clients spread across the communities of Europe. They are who we exist to serve. We will ensure we understand them and their expectations.
Expectations are that we're more than financially successful, that we provide the service and support they expect, and that we're good corporate citizens, too. If we do this, I believe we have everything we need to be the bank for Europe's future. Today, I will talk you through how we are going to optimize the business and the changes required to ensure our people and our banks can deliver together for all our stakeholders. I will then take you through how we need to be set up for our future, focusing on digital data and sustainability. After that, I will share our financials and how we're going to use three levers to achieve our ambition. Finally, I will take you through our regions one by one and the actions to deliver on our goals. Let's start with what we have to work with: UniCredit today.
UniCredit is a bank with incredibly strong foundations across Europe: in our clients, in our people, and in our banks. We have 15 million clients—14 million in retail, where we're strong in the value-accretive affluent sector, and 1 million in corporates with a particular presence in SMEs. For our clients and for our best-in-class partners, we are the gateway to Europe. We have incredible talent and a truly diverse and multicultural workforce. From management to the network, we are proud that 33% of our leadership team are female, but there is a lot more to do to reach parity, which is our ambition. This workforce reflects and knows the clients we serve. We understand their history, their needs, their challenges, and ambitions better than anyone else because they are also our reality. Our institution is built on the strong foundation of 13 local banks.
Banks that deliver cross-border payment market share of two times the intra-country one enjoy an unmatched heritage and untapped potential. We need to respect our local banks and their unique identities, but we also need to unify them to unleash the power of this collective, turning them into something much greater than the sum of their parts. At the moment, we're not capitalizing on these raw ingredients. Our stakeholders, our clients, our employees, and our investors are telling us so. In many ways, they are right. I've spoken to many of our different stakeholders in recent months, and some common themes have emerged. We're sometimes confused about what we stand for. There is a sense we have lost sight of our purpose. We're not delivering for clients to the standards we would want. Our employees are not set up to deliver excellence.
We lack empowerment within clear guidelines and are often hampered by bureaucracy and internal resistance. We lack a clear strategy for sustainable growth, a clear path to stronger return on tangible equity, and our capital distribution is uncertain and just too low. Our current valuation does not reflect our inherent value and potential—potential that is great, but still untapped. These are not issues unique to UniCredit, but resolving them is central to our ability to transform. We need to move out of a period of retrenchment and restructuring into an era of purpose, growth, and value creation. This does not require a fundamental change in who we are, just a change in how we go about our business and an investment in our future.
UniCredit Unlocked is our new strategic plan to unleash the potential within this business. It's built on the UniCredit you have just seen in that video. At its heart are five strategic imperatives and a new financial ambition. We will refocus on our regions and develop our client franchise, securing growth from both existing and new clients. Our best-in-class products will be developed in-house and through close partnership with leading providers. We will change our business model, moving to a capital-light business with targeted cost efficiency to fund investment and deliver operating leverage. We will deliver economies of scale from our footprint of 13 banks, empowering our regions to own their business within a clear risk and behavior framework. We will transform our technology with a new operating model that moves core competencies in-house, introducing a new way of working centered around clients, common platforms, and modular development.
We will embed sustainability in all that we do, leading by example in our own business, helping our clients through a just and sustainable transition, and contributing toward a better society. We aim to reach a return on tangible equity of around 10% and an annual sustainable distribution totaling at least EUR 16 billion between 2021 and 2024. We will deliver this through three levers. First, EUR 500 million of absolute cost reduction, net of EUR 600 million investment and EUR 450 million of inflation. Second, we generate organic capital of around 150 basis points per annum from increased profitability and a more capital-efficient model. Third, EUR 1.1 billion of incremental net revenues, mostly driven by fees.
This will also mean we will have built the foundations to deliver on our longer-term ambition post-2024, because we view 2024 as just a checkpoint of a much longer journey. Underpinning it all is a new culture, a new way of working that I want every UniCredit colleague and partner to embrace. It's a culture that puts us back on the front foot, energized and emboldened to deliver UniCredit Unlocked. I want us to win for our clients, for our investors, and for ourselves. I want us to be proud to be part of UniCredit and to be part of an institution that is committed to success. I want us to win in the right way, putting the values of integrity, ownership, and care at the heart of our decisions and everything we do.
I want us to do it together as one team, acting as true partners to our different stakeholders. Many of the flaws of our industries can come back to these three things not acting together in synergy. We must therefore cement our shared ambition, taking us from retrenchment to renewal, from a defensive posture to one of positive, sustainable growth. Two principles underpin our strategic plan: a plan to optimize today and one to build for tomorrow. Optimizing today is all about making sure our bank is fit for purpose and that our clients are at the heart of everything we do. Our assets are pan-European: 15 million clients and 87,000 people. It is my job to ensure that we have the right structure in place to connect them to our 13 banks and 4 regions in a unified way across Europe.
We're taking action to do this by changing our client segmentation, harmonizing our service model, simplifying our processes, establishing a common organizational structure group-wide, and redefining our product factories so they're best in class and deliver for all our clients. Let's move to optimizing today. Our client grouping is currently fragmented across our countries. We have already begun to change the way we segment our clients, approaching it the same way across all geographies, an action critical if we are to effectively use data to better power our client delivery. In our corporate business, large, medium, and small, we make 46% of our revenues and a healthy ROIC that we're determined to improve. In retail, we make 54% of our revenues with a very strong ROIC.
These numbers exclude the impact of the group corporate center that we will continue to compress. With a unified client view and service model across all our banks, we will be able to respond to the needs of our 15 million clients in a targeted, yet cohesive way. Put simply, this means we can ensure every client, whether in Germany or in Croatia, is offered the best products and the same varied choice. We cannot serve our clients without our people, but we need to provide the right organizational structure for their benefit. We need a clear line of sight from management to the regions to the local networks, so that they can serve their clients in the best possible way. We are moving from a command and control model in which multiple layers and sign-off of decisions are required.
Where, for instance, in Italy, 83,000 decisions are taken by Risk each year, despite the business being better placed to make them. To a model in which our people are trusted and empowered, where they can take ownership of decisions within clear risk and behavior parameters, with streamlined processes, second-line controls, and the ability to escalate to a light steering group where necessary. A model that puts decision-making back where it belongs, with the people who know their subjects best. This will unlock the talent within our organization, increasing the speed and quality of decision-making. All this is already in flight, and we will accelerate into next year. It is not enough to only fix the framework in which our employees operate. We need to provide our people with a common ambition. We need to cement our purpose, empowering communities to progress.
We need our people to have a clear vision of what UniCredit can be and their role in getting us there. We will do this with a new mindset: Win the right way together, empowering them to deliver, encouraging an entrepreneurial spirit, so that we all feel part of something bigger. We will galvanize them behind a common objective. We will fully energize our people to own their clients, reinstilling in them a hunger to perform and a pride in this business. We will arm them with the tools to do their jobs to the best of their ability. We will inspire them and establish a collective mindset of ownership and action, focused on best-in-class service, innovation, products, and delivery, all within a clear risk and behavior framework.
We will take pride in the truly European nature of our bank and our people, and we will reclaim our market share. This work has already started. We have reduced the bureaucracy in our organization and asked our employees to take back ownership of our bank. While there is still a lot of work to do, the results already achieved in 2021 demonstrate that we're moving in the right direction at pace. Our banks are also complex. We have 13 strong individual businesses, not even united by name. Our role here is to create one bank, much stronger than the sum of its parts. We're moving from a complex, siloed model with a heavy corporate center and fragmented IT support to a simplified, empowered organization with a lean corporate center that embeds digital and data across the business.
We're shifting from a bank with five business divisions, including the corporate and investment bank, that has not been fully focused on all of our clients, to four coverage regions: Italy, Germany, Central Europe, and Eastern Europe. All are powered by two client-agnostic product factories, which will deliver best-in-class products and services to our entire client franchise. Thirteen banks working as one. All four regions are critical to our success and have significant potential for improvement. Italy generates close to half of the group's revenue with a healthy ROIC of 10%. Germany generates more than EUR 4 billion in revenues and has a 7% ROIC with superior quality assets and products. Central Europe generates EUR 3 billion in revenues with a healthy ROIC at 11%. Eastern Europe generates EUR 2 billion in revenues at a strong 13% ROIC.
The regional model will fully return client coverage to the banks, strengthening our client partnership. The model will respect the individuality of our local banks while also leveraging the strength that comes with uniting them for the benefit of our clients. Our people will have responsibility and accountability for the decisions they make for clients within clear risk and behavior parameters. Our organization will give our people the tools they need to succeed. Let me move to our product factories. Our product factories are corporate solutions at over EUR 5 billion of 2021 revenues and individual solutions making up just over EUR 3 billion of 2021 revenues. Together, these constitute close to half of our revenues, which we plan to grow further as part of our capital-light growth strategy. This means three things.
First, our product shelf will contain a balanced mix of best-in-class solutions developed internally or together with partners. Second, we will have a comprehensive offering so we can meet the needs of all of our clients. Third, we will leverage digital and data for a seamless client experience and also integrate our technology platform with partners to provide better service. These will serve all four regions. Let's move to corporate solutions, which will continue to provide its extensive expertise to our clients. This will now be enhanced and provided to all our 1 million corporate clients across all our regions. Our model is differentiated for a number of reasons. Firstly, we have a large, loyal corporate client base with existing long-standing relationships. We will focus on them. Secondly, we already provide high-quality products that we now need to better leverage.
Thirdly, our cross-border positioning allows us to support clients in their trade, transactions, and growth ambitions. This will bring advanced solutions for corporates across verticals and turbocharge our high-quality revenue stream. In corporate solutions, we expect ROIC to improve from 13% this year to 17% in 2024. Advisory and capital markets are going to grow fast from a low base. We're investing in the creation of top-quality content and advisory products targeted to our client base. Transaction and payment is the biggest contributor to corporate solution revenues. We will harmonize and enrich our international payments, trade finance, and working capital offerings, leveraging our client e-banking portals. Client risk management will work on enhancing key execution digital capabilities.
Finally, specialized lending will increase profitability with an originate-to-distribute approach, help deploy Recovery and Resilience funds, and support our clients in their transition to a more sustainable future. Our product offering is rich with scalable best-practice solutions, and we are building it out on a cross-country basis, responding to the needs of our existing core clients. Let's move to individual solutions. The principles behind our model for individual solutions are as follows. Our model delivers an attractive choice for clients. We benefit from the know-how and economies of scale of our best-in-class external partners. Our model involves limited risk-taking, especially in insurance. We benefit from shared costs with our external partners and IT integration. This is also a model that delivers strong results for all our stakeholders. We have a high retention of the value chain and partner with best-in-class providers.
We have targeted scale and leading market share where it counts. For example, we have EUR 800 billion of total financial assets and a market share in Italy in unit-linked life insurance of circa 40%. We have very high returns from this model that we're well-positioned to maximize. Individual solutions make a significant contribution to group returns given their extremely high ROIC. Our insurance offering is a core priority. We will now benefit from simplifying our partnership and investing in improving our commercial effectiveness. We expect the strongest growth from protection, up 19% per year from a low base as we enhance our product shelf, hire more specialists, and Italy converges with other European markets. Asset management is based on a mix of internal competencies and solutions from external partners. Our partners will support us with innovative solutions, cash conversion, and ESG products.
We have an attractive client franchise that we can best serve with a combination of existing offerings and those of our chosen partners. These ingredients will ensure higher penetration and will further boost our capital line revenue stream. Integration of our IT platform will enable a seamless client experience. As I said, our plan for UniCredit is not a short-term plan. It is a plan that builds on our strong foundation and unlocks the potential of our group. It is also one that paves the way for the future, our future, and the future of the clients and communities we serve. One that builds a bank for the long term, a bank for Europe's future. In practical terms, this means investing EUR 2.8 billion in digital and data over the life of our plan.
Our ambition for these areas is bold, and we're committed to executing on them as fast as we are able. Some of our projects are deliverable in the immediate future, while others have a longer lead time, but all have our unreserved long-term commitment. This is a journey, and there is a long road ahead of us. We will commit to being held accountable, and we will provide updates on our progress. We will seek to roll this out as quickly as possible and commit to finishing what we started. We are embarking on four key projects: improving the user experience across all devices; boosting our digital offerings such that areas like onboarding have less and less unnecessary manual intervention; driving the payment value chain, starting with a digitized FX offering that is consistent with our clients' day-to-day needs; and continuously strengthening our cybersecurity defenses.
We can already see the impact from a number of these pilot projects. In Germany, Smart Banking is already rolled out and is a reality for all our 1.5 million mass market clients. 500,000 of them can now interact with an online branch. In Croatia, we launched Smart Invest, a product which leverages relationship bankers by helping profile and recommend investment management options live. This boosts sales within a controlled environment, improves client experience, and drives efficiency. In the Czech Republic, we're using an artificial intelligence chatbot for recruiting, improving the quality of our hires, and all but eliminating unconscious bias in the process. In Austria, clients are able to access pre-approved consumer loans, both remotely and in branch, in less than five minutes with only three steps for the relationship manager.
This is about maximizing innovation in each of our local markets and partnering between our geographies to learn and share. This is what it means to come together as one to exploit our scale by leveraging best practices across the group. We compare the best of digital from Germany with the artificial intelligence learnings from the Czech Republic, crossing the technological innovation of investment management from Zagreb with the strides made in online customer service in Munich. This is about investing in our business, in innovation, and in the front line where it is needed most, translating into close to 4,000 new hires over the course of the plan. Our ultimate ambition is to be a truly digital bank powered by data in all that we do.
What we have works, but if we want to progress, it needs to change and be made fit for the future. Digitalization has to be at the heart of our strategy. To do this, we're internalizing what we believe are the necessary core competencies, simplifying and streamlining. We're developing a new way of working where modular and reusable solutions can be scaled across the group rather than be limited to each single bank. We will fund this with a higher overall spend that is strategically prioritized. We'll organize ourselves through a product lens, creating agile, cross-functional teams dedicated to solving problems for our clients. Once we have cemented the above, we can use data and artificial intelligence to provide a new digital experience.
We will do all this while maintaining our investment in and commitment to cybersecurity as part of our focus on enhancing resiliency and protecting our companies and clients. We have a highly fragmented infrastructure, with different countries relying on different technology setups. The vast majority of our work is done by external providers who add layers of bureaucracy and increase time to market. This also comes at a higher price, on average 30% more than our internal colleagues. We will take back ownership of our core competencies, hiring product managers and developers into our organization under our control, supervision, and risk framework. We are targeting a skilled, streamlined workforce that is more cost-efficient and more productive—a workforce that knows when to create products in-house and is able to do so, and when to pick from the very best of our partners' offerings.
This will reduce our reliance on high-cost external funding by two-thirds up to 2024. Currently, our way of working is in silos, with each country developing products from scratch, with limited reusability across the group. We want this enhanced team to work differently. We will reorganize into three global platforms: technology, data, and business. These will be responsible for the overarching group technology development, and the countries will deliver the last-mile products tailored to their requirements, but coherent with group architecture. In this way, product development can benefit from learnings in other countries, as opposed to being built from scratch each and every time. This will enable us to deliver higher-quality solutions faster for our clients. How do we do this? Currently, our IT expenditure is spread across an internal and external workforce.
We're going to direct our higher digital spend toward internalized, lower-cost, higher-output colleagues with the skill set we need. Secondly, we will better direct and prioritize the spend, leveraging the benefits of scale. By centralizing the many contracts that we currently have in place, we can unlock significant buying power. We will have a digital and data strategy that befits a global organization like ours. Our new model will bring the function out of its historical silos and move to a product-based approach that leverages common platforms. One example of this is the mortgage offering. In Italy, we have 17 different steps and teams required to approve a mortgage. We're determined to simplify this process and are in flight to do so. Once this is done, we can digitize and replicate it across the group.
Another example is in consumer finance in Italy, which we piloted to great success last summer. We put a small cross-functional team together for eight weeks. In that time, we launched the first end-to-end PSD2-enabled platform for new bank customers, giving us confidence that this way of working can and will be scaled. Data is where banks lose versus fintechs, and this needs to change. While fintechs have led in terms of technological advancement, incumbent banks have something fintechs don't have, something you can't buy: client relationships and experience. Relationships will bring with them a pool of deep, rich, untapped data from years of working closely together with our clients. If banks can find a way to develop their technology, leverage their financial expertise, and really understand how they can and should use their data, the opportunities are endless. We're no different in this respect.
We, too, need to use our data more intelligently. With 50 million clients comes a huge amount of data. We should know our clients much better, and we will. We intend to offer a personalized service focused on behavioral choices and engagement at scale. Our banking will become simple with straight-through processing journey design. We will develop a global data platform powering broad and real-time data accessibility in the coming years, so we can provide smarter products and value-added services. We will be proactive, anticipating needs and focusing on data-driven advisory, and we will internalize the development and management of core data and artificial intelligence capability, so that we can make decisions more quickly and more intelligently.
We cannot be a bank for the future, a bank that wins in the right way, together, without a commitment to sustainability and a passion for investing in and supporting the communities within which we operate. This will be embedded in our culture and at the heart of all that we do. What does this mean in practice? It means holding ourselves to the same standards that we seek from our clients. It means demonstrating real, measurable, tangible actions and results, such as reducing our greenhouse gas emissions by 60% since 2008, targeting net zero by 2030.
79% of the energy used on our premises is renewable, and we're targeting no single-use plastic items in our buildings by the end of 2022. We've contributed more than EUR 40 million to corporate citizenship and philanthropic initiatives and to the education of 100,000 young people, and this is far from being enough. We will invest EUR 100 million in ensuring equal gender pay, which means equal pay for equal jobs. As well as practicing what we preach in our bank, we will help our clients and communities be more sustainable. This will inform all our choices, from who we partner with to deliver aligned environmental and social goals to how we mobilize capital and set targets to foster sustainable development.
To that end, we have established an ESG advisory model for corporates and individuals to finance innovation for the environmental transition, partnering with key players to enrich and improve ESG offerings across sectors. We've also developed strategic projects with key partners for specific social challenges. These cover job inclusion and female empowerment, financial literacy, entrepreneurial skills, and basic education for vulnerable categories. Some examples include Wind Power Energy, which focuses on the retraining of miners in Romania, and Start Up Your Life, a youth financial education program in Italy. Navigating this transition is a key part of empowering communities to progress. Our financial goals: UniCredit Unlocked is about creating a bank that is financially strong and successful. When this happens, we will win for all stakeholders and fulfill our purpose of empowering communities to progress. This is unlocking the true potential of UniCredit.
We have already started on this journey. Our clients are now grouped in the same way, and we are adjusting our service model. Our people have clear objectives, and we are driving the business forward. We have a new client-focused organizational structure with a refined management team. Our digital transformation is in flight. Our underlying return on tangible equity will be above 7% for the full year, and our CET1 ratio has been held constant while absorbing around 100 basis points of regulatory headwinds and the capital required for our growth. This is the first evidence that our strategy focused on capital-light profitable growth is starting to deliver. The macro environment remains crucial given our footprint and business model. Over the next three years, we assume a conservative interest rate scenario as our plan seeks to create alpha rather than beta.
The combination of our countries is expected to deliver GDP growth that is 20 basis points above the Eurozone average over the course of the plan. This is helped by our Central and Eastern European positioning. In many of our markets, loans should grow at a multiple of GDP, turbocharging our top-line growth. In addition, we anticipate opportunities from the Recovery and Resilience Facility allocation. Our countries have access to 50% of the overall fund disbursement. Please note that our assumptions exclude unexpected materially adverse developments such as the COVID-19 pandemic, a situation that we are closely monitoring. Our financial ambition to unlock UniCredit is based on 6 pillars: optimize, invest, grow, return, strengthen, and distribute. These pillars will deliver sustainable performance and profitable growth through a cycle. 2024 is just one milestone and a step on our longer-term journey.
Let's take these pillars one by one. Optimize. We optimize UniCredit by improving both our operational and capital efficiency. Operational efficiency: EUR 1.5 billion of gross cost savings, of which EUR 400 million will come from digital and data alone. Capital efficiency: Contributing circa 130 basis points to CET1 over the plan. Invest. Thanks to the resources freed up, we will invest EUR 2.8 billion over the plan in digital and data, as well as in our frontline and in ESG. Grow. We will grow our net revenue at 2% CAGR, largely from fees, and we will grow our net profit at 10% a year. Our EPS should grow at above 15% per year, helped by the assumed impact of share buybacks.
These growth rates are net of the optimization already in flight. Our underlying growth rates will be higher, and our growth shall accelerate from 2022, which we consider a consolidation and investment year. Return: We expect to reach a return on tangible equity of around 10% in 2024 and aim to surpass it thereafter. Strengthen: Our financial strength will rely on a target CET1 ratio of 12.5%-13%, a target 150 basis points organic CET1 generation a year on average, a gross NPE ratio declining to 3.5%, and a net NPE ratio below 2%. Distribute: We intend to distribute at least EUR 16 billion over the next four years. Our significant organic capital generation alone gives us confidence in our ambition. Our high CET1 starting point provides us with a further buffer.
We expect to return EUR 3.7 billion to shareholders in 2021, a similar amount in 2022, and to progressively increase the amount from 2023 onward, all while keeping within or even above our target capital range. Our distribution for 2021, to be paid in 2022, is the first sign of our tangible commitment. These are the six pillars with which we will tackle our financial ambition. We focus on three interconnected levers to drive returns. Firstly, we will target our cost reduction to ensure zero impact on our revenue-generating capacity and the maintenance of a best-in-class control framework. Capital efficiency will be a key differentiator for us. We deploy our capital in order to maximize our return on tangible equity and grow on a sustainable basis.
Net revenues, measured as revenues less loan loss provision, ensure both that our growth does not come at the expense of sound risk management and that we increase our focus on our fee business. Two of the three levers, cost and capital, have lower execution risk due to them being largely under the control of management. The third one, net revenues, is based mostly on alpha, as we take a conservative view on the interest rate environment. These three levers interact. By managing them together, we can optimally balance growth, strengths, and profitability. Let's now go through them one by one. Cost: We see operational excellence as the continuous process of delivering efficiencies and self-funding our investments. It is already yielding results. Non-business-related costs will decrease substantially over the plan compared to a mild reduction of business-related ones.
We will produce cost reductions on a consistent basis rather than back-ended, through front-loading efficiencies targeted under the previous plan and executing faster on the new ones. This, in turn, will free up room for investment in both digital and data, and in our business. This overall cost plan will lead to a better client experience, an improved working environment, and higher revenues. Following such an approach, we will realize gross cost savings of EUR 1.5 billion. This will enable us to absorb EUR 450 million of inflation, such as wage drift, and fund EUR 600 million of investments, still ending with a cost base EUR 500 million lower than in 2021. There are three drivers to our cost reduction: Team 23 savings from front-loading, digital and data rationalization, and the impact of simplification and streamlining.
We will book EUR 1.2 billion of integration costs related to these cost savings in Q4 2021. As a result of our cost efficiency, we will be able to self-fund our digital transformation. P&L investment in digital and data increased by EUR 400 million over the life of the plan. Our overall investment in cash terms in digital and data is EUR 2.8 billion over the plan. This is not comparable with previous disclosure due to an accounting change. On a like-for-like basis, our overall investment is EUR 800 million higher than the run rate in the previous three years. We will also self-finance and reinvest into the business through targeted hiring in the front line amounting to EUR 100 million. Finally, we will invest EUR 100 million to ensuring equal gender pay, which means equal pay for equal jobs.
Notwithstanding the above, our overall cost base in 2024 will be EUR 500 million lower than in 2021, with a cost-to-income ratio around 50%. UniCredit has a very strong track record of cost reductions, and we intend to maintain it. The combination of revenue growth and cost management while investing leads to a sustainable business model with positive operating leverage of 4 percentage points. We are shifting our mindset to a focus on risk-adjusted returns and growth, while constantly trying to maximize our net capital generation, the CET1 we generate in a year minus the one we absorb for growth. We're going granular in order to allocate capital more efficiently. We need to optimize to improve lower-returns areas. We also need to empower the business to own the client and the process.
This is a strategy that I have successfully deployed in the past and that I assure you will deliver real results. It hinges on discipline and execution, something UniCredit is great at. By clearly differentiating between the areas of lower return and those of high return, we will drive our business mix to focus on capital-light revenues. We are already ahead of our European peer group when it comes to fees as a percentage of revenues by 10 percentage points on average. We target an even higher contribution by 2024. Of our EUR 1.1 billion delta in net revenue, EUR 800 million is in fees with 0 RWAs, so this is genuine capital-light growth. Capital and revenues interact significantly. Knowing that, we're looking into our portfolio with an increased level of granularity.
We need to improve lower-return areas, either by increasing our share of wallet or increasing our pricing. If this isn't successful, we should consider divesting, always mindful of our overall client relationships. As a result of all of this, we expect risk-weighted assets to decrease over the course of the plan. This will come hand in hand with improved, higher-quality, capital-light profitability and a shift in the shape of our business. Together with active portfolio management, we will more than offset the impact of organic growth and expected regulatory headwinds. Active portfolio management includes securitization, which this group has scarcely relied upon in the past and which is in flight. We will also actively manage our portfolio, reducing and even exiting low-performing businesses.
We will undertake a dynamic rebalancing of our loan book towards areas that are more capital efficient due to, among other things, collateralization and areas that have higher risk-adjusted returns. We do not expect any significant impact from regulatory headwinds over 2021-2024. Beyond the plan, we see a fully loaded Basel IV impact of around 70 basis points. We intend to improve on that through a number of mitigating actions already in flight. Furthermore, the entire Basel IV impact will be offset in full by the fully loaded positive impacts of the DTAs. As a result, we expect to significantly improve our net revenue return on RWAs by around 35 basis points. In addition, organic growth from higher risk-adjusted return businesses adds 10 basis points to these returns by 2024.
As I said earlier, this is an area that I have experience in and have delivered upon in my recent past. I believe UniCredit has significant scope for capital efficiency improvement, which we are determined to deliver. Let me now explain the net revenue lever in more detail. We're embarking on tangible steps to drive capital-light growth. We're not envisioning a revolutionary road, but rather incremental improvement relative to our starting point. Net interest income after loan loss provision is targeted to grow by EUR 400 million over the period. This will come from more capital-efficient and higher-margin business and in areas where our market share has suffered in the last two years due to excessive risk aversion. Our recent consumer finance pilot in Italy reinforces our confidence in our ability to regain our share.
This growth will be partly offset by headwinds from the full repayment of TLTRO and a slight increase in absolute loan loss provision as our loan book grows. We would note that our assumptions on interest rates are conservative. Fees will be driven by our detailed plan to enhance corporate solutions and our expanding product shelves in individual solutions, combined with a related investment in our frontline in digital and data. We believe this growth is achievable, and it is based on reasonable assumptions. Differently from the past, we are re-energizing the frontline and empowering and reinvesting in our people. As a result, revenue growth should accelerate over the course of the plan as the higher base of 2021 drops out, and we reap the benefits of our people taking back ownership, supported by our investments.
The delivery of the above is made possible by, and is critically dependent on, empowering our people and their shift in mindset to one of disciplined growth within a clear risk and behavior framework. We are one team. We are working together to deliver. As we have discussed, sustainability is a critical part of winning in the right way. It is not a talking point, but something embedded in our financial plan. In environmental lending, we expect incremental revenues of EUR 200 million as we grow our green loan book to support the transition. In investment products, we expect a conversion towards sustainable products so that over 40% of assets under management will be invested in ESG. We expect a significant issuance of sustainable bonds linked to the Recovery and Resilience Facility.
On social lending, we're expanding the scope to activities with high impact on society and disadvantaged areas. We have already provided more than 5,000 microloans and reached more than 1.9 million beneficiaries with our social impact financing activities, thanks to our support of hundreds of initiatives. In the next three years, we target new ESG volumes of EUR 150 billion cumulatively. This commitment is key if we are to fulfill our ambition of being the bank for Europe's future, a bank that is focused on empowering communities to progress. Our network is already empowered to drive growth within our existing risk framework. In this respect, loan growth is focused on regions or client segments with a lower cost of risk or a margin capable of covering the necessary loan loss provision and still delivering an adequate return on capital.
Our weighted average cost of risk should remain stable in the future. Our gross NPE ratio should continue to improve. Our net NPE ratio should also remain stable at a low level relative to both loans and our tangible equity. Finally, a large majority of our NPEs are classified as unlikely to pay, a sub-segment where we are determined to improve our recoveries. The way we combine our three levers will deliver a return on tangible equity of about 10% in 2024. The return on tangible equity is now calculated based on our net profit after deduction of coupons on AT1s and CASHES and before the write-up of DTAs. Symmetrically, we also adjust the denominator for the CASHES contribution and DTAs. Our 2024 return on tangible equity represents a substantial step up from the 2021 result, but we believe it is achievable.
Let's now talk about guidance given our new net profit definition. Our 2021 net profit guidance of above EUR 3.7 billion was under the previous definition. Under the new definition, it would be greater than EUR 3.3 billion. We see 2022 as a consolidation year, and our net profit guidance is circa flat to 2021. Our business plan incorporates a conservative stance on our balance sheet, and we will start by operating with ample buffers over our capital and liquidity requirements. Our target CET1 ratio is now at 12.5%-13%, well above our regulatory minimum with a buffer of between 350 and 400 basis points. We believe this to be prudent, particularly at the start of our transformation. Further, it does not impinge on our ability to return equal to or more than EUR 16 billion until 2024.
If anything, it gives us more confidence in our ability to do so sustainably. We now also target a leverage ratio of over 5%. By 2024, 45% of our capital will be allocated to countries where the sovereign is rated above single A, an increase of 4 percentage points over the plan. We are changing our business model to focus on organic capital generation. We look to balance the maximization of net profit with the minimization of capital consumption to achieve it. We further increase such capital efficiency through active portfolio management. In doing so, we're more profitable, and we're less constrained in our growth as we're more capital efficient, using less capital for each additional euro of growth. This can be seen in the two graphs, where the shaded green area represents the organic CET1 capital generation net of the CET1 used for growth.
This equates to a potential distributable amount at the bottom of our target CET1 range. In essence, we now generate three times the net CET1, and hence distributable amount, in comparison with the old plan, without having to stress our CET1 capital ratio. We're building a foundation for the future that supports significant sustainable distribution while maintaining capital strengths. Given our stability, improved organic capital generation, and our strong starting capital position, we're committed to an increased distribution to shareholders. Specifically, our new distribution strategy leads to guidance of EUR 3.7 billion for fiscal year 2021, significantly above the previous plan. We intend to maintain a distribution of the same amount or more in 2022, a consolidation and investment year, and progressively increase it from 2023 and beyond.
This is supported by the generation of 150 basis points of net CET1 per annum through net profit and RWA actions, hence without denting our existing CET1. This is obviously subject to maintaining our net profit in range, exceeding our minimum CET1 and leverage ratio targets, and securing full supervisory and shareholder approval. This distribution should be through a mix of cash dividends and share buybacks. We will target cash dividends of about 30% of underlying profit in 2021, and a 30% payout ratio from 2022 onward, relative to our new definition of net profit described earlier. As these distributions are predicated on returning our net annual capital generation to shareholders, we consider them ordinary, while obviously dependent on our execution. They do not rely on returning excess capital to shareholders.
This is something we could consider doing when appropriate, subject to supervisory and shareholder approval. We intend to commence the incremental buyback after the April 8, 2022 AGM, pending supervisory approval. This improved and sustainable distribution while growing the business profitably is what we mean when we say we will win for investors today, in the next three years, and beyond. As well as maintaining our robust capital position, we also have the option to undertake M&A within clear guidelines. As I have said, and hopefully demonstrated, I believe that M&A can be an accelerator, but only at the right terms and conditions. We will continue to look at opportunities on the market through three lenses: strategic consistency, strengthening the business, and being accretive to returns and distribution over a reasonable timeframe. We will only consider M&A where it meets all three criteria.
We now turn to our regional business plan and our vision to leverage our pan-European identity in order to win for all our stakeholders. The cornerstone of our strategy is leveraging our 13 banks to reap our inherent scale advantage while retaining their identity and empowerment. This is key in digital and data, but also for our client solution offering, where we can invest in cutting-edge products and services at a level our individual banks could not do alone. We expect and demand that each of our banks exceed its respective cost of equity on a standalone basis through its own measures, now supported by economies of scale from being part of this group. Our countries have varying attributes. Italy is relatively high return. Central and Eastern Europe are higher growth. Germany is lower risk.
The combination of these countries brings us diversification benefits and optionality many other banks don't have. In my opinion, it creates an attractive portfolio in terms of sustainable risk-adjusted returns and growth. Through this model, we can also serve clients cross-border, promoting an ecosystem as our partners gain access in one go to a unique combined European client base. This is a key element that we plan to better leverage in the future with our partners. We have market share where it counts within our communities and client segments. There is also limited correlation between average market share in a country and returns. For example, our market share in Germany is low overall and across the whole country. However, due to our particular strengths in Bavaria and in corporates, we make an ROIC above the cost of equity in that segment.
Around 60% of our portfolio of countries has a ROIC in excess of 10% at the starting point in 2021. We're determined to move to 100% by 2024. In Italy, we have strong positioning. Our loan market share is above 10% in regions accounting for over 75% of GDP. We have an optimized network for our client segments, and it usually punches well above its weight. For example, in Lombardy, while we have a market share of branches of just 6%, we have a loan market share of over 10%. Our distribution power is a major attraction and reflected in product market shares. For example, we have more than 10% market share in funds and in loans in Italy and around 40% in unit-linked life insurance.
The macro environment is supportive with strong growth dynamics for financial services, and Italy accounts for a significant portion of the Recovery and Resilience Funds. Italy's business will undergo a very significant shift in direction, further improving the quality of its franchise and focusing on higher growth and more profitable areas. We will do significant work to optimize our capital deployment, including exiting certain unprofitable businesses. This means that to appreciate Italy's performance, we need to look at the deployment of capital and the growth of a disciplined execution of these optimization actions to understand the work that is being done to build on the foundations of this business. On this basis, gross capital deployed to the country grows by 1% per annum. Accordingly, gross revenues are expected to grow at 3% per annum, much higher and much higher quality growth.
We are investing in the frontline, fully funded by cost reduction at the center, and will drive to an exit cost-income ratio of 46%. These actions will deliver above EUR 2 billion of net income, up EUR 16 billion of capital, driving a healthy return on allocated capital of over 12% for the country. The actions underpinning this growth include investment in our clients, the network, and broader Italian society. We're enhancing our investment and insurance offering for retail and SMEs. We will rebuild our natural share in high-risk-adjusted return businesses and expect consumer lending to grow at 10% per annum over the plan. We are reshaping and strengthening our network to improve frontline effectiveness. For example, we are hiring 1,700 people in advisory and insurance talent. We're redesigning the network processes for a digitally native client experience.
We intend to double our digital sales and accelerate the time to "yes" for our clients. In better serving our clients, we strengthen the communities in which we operate. Supporting local people, their businesses, and their local economies is at the heart of our offering. For example, our academy is a new physical and virtual location that will act as a center of excellence to train and reskill our people. We have also committed to donating the funds generated through our Carta Etica back to the grassroots of those communities because they are the reason we exist. Let me now move to Germany. Our strengths in Germany enable us to actively support the economy and society. We have a customer-centric model with 2 million clients. Our market share is over 10% in Bavaria, driven by our Mittelstand franchise, and it's linked to export industries.
This has been extended, so we have a strong position in corporate banking throughout Germany, also reflected in the best NPS among small and medium corporate clients in the country. The macro environment is supportive. Of course, Germany is the largest E.U. economy with a focus on export, and we have the full network to capture this. Our ambition in Germany is to lead in efficiency and sustainable profitability with returns well above the cost of equity. Allocated capital will grow by 2% a year after active portfolio management to offset regulatory headwinds. This drives net revenue up by 2% per annum. Even after hiring, the streamlining of the business model will drive the cost-to-income ratio to around 50% by 2024. The combination of these levers will deliver above EUR 1 billion of net income, up 16% per annum.
On EUR 11 billion of allocated capital, this will increase ROIC by 4 percentage points to reach over 10% by 2024. The initiatives to deliver our plan include further strengthening our ESG advisory capabilities, partnering with our clients on their green transition. We have targeted ESG revenue growth of more than 20% a year over the plan, with a large part of it replacing existing facilities. We are investing in our private banking footprint to become a top-tier player across Germany. The review of our processes and products will enable the streamlining of our headquarters in Germany. Non-business costs will fall 9% a year over the plan. Let me now move to Central Europe. Central Europe includes some of our fastest-growing, high-potential, and profitable businesses. Overall, we're number two in terms of clients and assets.
We have an 8% market share in retail that we're determined to increase, 14% in corporate, and an overall loan market share of around 11% in the region. In Austria, we hold the number one position and are recognized as the best bank for SMEs and the best investment bank. In the Czech Republic, we are the best private bank, and in Hungary, the best social impact bank. The macroeconomic environment in our Central European footprint is supportive, with GDP growth well above the European average. We have a very strong connection between this region, Italy, and Germany, which we will continue to capitalize on. Our capital allocated to Central Europe will grow by 5% per year.
Revenue growth is a key lever of the plan, and we expect good top-line growth given the GDP and loan growth outlook of the region, our commercial initiatives, and our focus on fees. We're investing in new hires, which are self-funded given the improved efficiency in Austria. Costs will fall 2% per annum, leading to a cost/income ratio comfortably below 50%. Together, this lever will deliver more than EUR 1 billion of net income, up 13% per annum, constituting a quarter of the group. On EUR 8 billion of allocated capital, this will increase ROIC by 3 percentage points over the plan to over 13%. Our initiatives focus on an improved client service model, driving client acquisition in both retail and corporate through digitalization. Our client base will grow by over 200,000 during the plan.
In 2024, we plan to have two-thirds of our customers digitally active and to perform over half of our sales digitally. In the last year alone, we have opened 10,000 digital paperless accounts in the Czech Republic. We will enrich our product offering, including advisory on the green transition. Furthermore, we're simplifying and automating credit processes to support faster decision-making. Finally, the redesign of Bank Austria's operating model is a key pillar supporting our plan. Let me now move to Eastern Europe. We are the leading bank in Eastern Europe, a high-growth region. Overall, we're number one by assets with over 4 million clients, and in many countries, our market share is well in excess of 15%. We are number one in Bosnia, Bulgaria, and Croatia, and we are top three for corporates in Serbia and Romania.
These are fast-growing economies with GDP growth of 3.7% on average over the plan. This is outstripped by loan growth of just under 6% on average. Our capital allocated to Eastern Europe will grow by 4% per year post active portfolio management. This will drive net revenues up 6% a year as we focus on higher risk-adjusted return products. We're investing in new hirings, partially funded by cost initiatives, which also have to offset inflation in the region. We do target best-in-class cost efficiency and a 40% cost-income ratio by the end of the period. Overall, the region will deliver around EUR 1 billion of net income, a fifth of the group in 2024, with a CAGR of 9%.
On EUR 5 billion of allocated capital, the ROIC should rise by 4 percentage points to over 16% by 2024, the highest of all our regions. We have a number of initiatives which drive this growth. Our innovative service model for micro and small corporates is supported by an enriched product offering, including client solutions, green advisory, and financing and liquidity management. This will support a 12% growth in net clients. We're launching targeted campaigns to support the sales process, and as in Central Europe, we're automating credit processes. Our retail client offering will be streamlined by 50%, enabling our colleagues to focus their commercial efforts. We will consolidate our existing position in corporates and expect our growth in retail to outpace the market. We intend to grow our net clients by almost 500,000, increasing the number of digital users by 30%.
We expect meaningful growth from our proactive approach to the recovery and resilience funds. In summary, our financial plan applies the three levers in varying degrees in our regions. All see a marked and similar improvement in return on allocated capital, landing above or well above their respective cost of equity, leveraging group scale. Our business plan means that the regional capital allocation will shift on a net basis, resulting in a more balanced outcome. Italy benefits from capital efficiency, Germany from cost efficiency, while Central and Eastern Europe are mainly driven by net revenue growth with efficiencies in capital and operations, allowing them to show positive operating leverage. The differentiated impact of the levers underlines the strengths and diversity within our model, our optionality, and the value of unlocking UniCredit.
To sum up, as outlined at the beginning of my presentation, we have a very clear set of strategic imperatives. These will enable us to deliver growth, a return on tangible equity of around 10% in 2024, and sustained attractive distribution to shareholders, winning for all our stakeholders. This shows our financial targets for 2024 across our main KPIs, which will enable us to distribute above EUR 16 billion between 2021 and 2024, and deliver around 10% return on tangible equity by that year. We are confident that as we successfully deliver on the levers discussed, we will unlock our full potential and have a compelling investment story built on very sound foundations. Our sustainability principles and our balance sheet solidity are and will remain the bedrock of that.
A relentless focus on cost efficiency will allow us to accelerate investments while actually decreasing our overall cost base, driving both growth and positive operating leverage. This self-sustaining path, when combined with disciplined capital efficiency, will generate high returns over the coming years within a well-managed risk profile. Finally, our net profit growth on an EPS basis will increase to a double-digit compounded average growth rate when coupled with a potential share buyback. UniCredit Unlocked is much more than the near future. It is about setting us up for long-term success. It is about releasing the potential of our bank to deliver for our clients, putting them back at the center, and serving them with the best product and advice that we can source.
It is about delivering for all our people, giving them a common ambition, the tools they need to excel, and a belief in the institution for which they work. It is also about delivering for our stakeholders with a business model that will enable success for all. This is a plan to help us fulfill our potential and to realize our purpose, unlocking the energy of our people and businesses across Europe and empowering communities to progress—a plan to ensure we win. We will win in the right way as we build the Bank for Europe's future together. Thank you.