ECONOMY

ETBA lifts Piraeus Bank

Piraeus Bank yesterday kicked off the earnings season for the banking sector by reporting a 16.2 percent jump in consolidated pretax profits for 2002, benefiting from the positive side effects of the takeover of ETBA Bank. The bank, expected to be the only one of the five major banks in the country to report positive earnings growth for 2002, lifted group pretax profits to 115.1 million euros from 99.1 million euros in 2001. Group net profits after minorities came to 66.2 million euros, up 11 percent. Piraeus’s positive performance was due principally to the unexpected benefit of its acquisition of ETBA Bank, said Sophia Skourti, banking analyst at Marfin Hellenic. The takeover was completed in March. «Piraeus had strong extraordinary gains of 29.7 million euros from the liquidation of real estate assets related to ETBA Bank’s bad loans,» she said. «Without this, its operating performance would not have been so strong.» On the negative side, the integration of ETBA doubled Piraeus’s non-performing loan ratio to 4.2 percent of its total lending. Results were also boosted by the sustained consumer credit boom. Net interest income rose by 34 percent to 366.9 million euros on the back of a 41 percent increase in loans to 9.07 billion euros. Deposits including repos and bonds edged up by 5.6 percent to 10.32 million euros. Net interest margin improved to 2.7 percent from 2.38 percent. Revenues from the core banking business grew by 30.5 percent to 496.3 million euros. The bullish stock market, in its third decline last year, continued to weigh on trading activities, with gains of only 20.5 million euros, down by 81 percent. Commission income was unchanged at 29.9 million euros. Piraeus Bank plans to recommend a dividend of 25 cents per share to shareholders.