Lenders’ first-quarter data suffer from NPL expansion

Two of the country’s biggest lenders, National Bank and Alpha Bank, announced on Thursday an increase to net losses in the first quarter of the year, which reflect the deterioration of economic conditions in Greece and which forced them to expand their provisions to cover nonperforming loans.

National’s group posted quarterly losses of 159 million euros, which are to a great extent attributed to the incorporation of financial losses of 112 million euros and the deterioration of conditions in Greece. The group actually posted losses of 290 million euros from its activities in Greece in the January-March period, against profits of 104 million euros a year earlier, while Turkish subsidiary Finansbank registered gains of 114 million euros, up 81 percent from last year. Other Balkan subsidiaries produced gains of 17 million euros, up 21 percent year-on-year.

Operating profits amounted to 418 million euros, but the country’s financial problems over the past few months generated new nonperforming loans of 477 million euros of which 336 million concern bad loans in Greece. To handle the growth of NPLs National proceeded to an increase in provisions for Greek loans by 323 million euros, up 18 percent on a quarterly basis.

The increase in provisions also weighed on the Q1 results of Alpha Bank, which showed losses of 115.8 million euros against losses of 94.1 million a year earlier.

At least the operating results of the Alpha group were positive, mainly thanks to its restructuring. Results before provisions posted annual growth of 17.9 percent to 294.6 million euros, but the uncertainty and the halt of the economic growth in the country have affected the level of deposits and the quality of the loan portfolio. Deposits fell from 42.9 billion euros in end-December to 36.01 billion in end-March, while there were new bad loans created that amounted to 554 million euros and the NPL index amounted to 33.8 percent.

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