ECONOMY

Emporiki group ups profit

The Emporiki Bank group announced yesterday that profit after tax and minority interests for 2003 was 71.8 million euros, a 37.4 percent increase on 2002’s 52.2 million. Return on average equity, after tax and minorities, rose to 5.9 percent, from 3.3 percent in 2002, while the group’s return on average assets increased to 0.4 percent, from 0.3 percent. Emporiki Bank (known until last year as Commercial Bank) said net interest income rose 9.1 percent to 611.8 million euros, reflecting changes in its asset structure and the composition of its loan portfolio. «The increased lending to consumers and to small and medium-sized businesses, segments with the highest spreads, contributed to the improvement in profitability,» the bank said. Management will propose a dividend per share of 0.5 euros, up 25 percent on the previous year. Based on the share’s closing price of 21.52 euros yesterday, the dividend yield comes to 2.32 percent. Despite increased group profitability, the parent company’s reported profit for 2003 (72.7 million euros), was lower than in 2002, when it was 86.1 million. This 15.56 percent decline was due to high costs. Administrative costs, at 507.7 million euros, are considered high by analysts, especially as the bank has made no expansionist moves in recent years. Also, despite the improvement, its return on average equity is far lower than that of other Greek banks and its current price-over-earnings ratio is 26, higher than that of other Greek banks. Emporiki estimated its Tier I capital ratio at 9.1 percent, or 1.2 billion euros, in 2003. Emporiki, Greece’s fourth largest lender by assets, with a current market value of 1.9 billion euros, is about 11 percent owned by France’s Credit Agricole. Emporiki’s management is in talks with Credit Agricole over the latter’s expanding its share to over 20 percent.