Eurobank bolsters profit growth and Balkan operations

EFG Eurobank Ergasias, Greece’s second largest by market capitalization and third largest by market share, yesterday reported a surge in results and a dynamic expansion into neighboring Balkan countries in 2003. Net group profit after tax and minorities advanced 39 percent to 273 million euros and the bank said it will propose a dividend payout of 0.60 euros per share, representing a return of 3.7 percent. The bank said capital and reserves at the end of 2003 stood at 1.8 billion euros – among the highest in the sector – although it did not avail itself of provisions for fixed asset value readjustments. Its capital adequacy ratio stood at 10.4 percent, composed almost entirely of Tier 1 capital. Lending in the Greek market grew 19.2 percent to 16.2 billion euros, leading its market share to rise to 13.8 percent. Eurobank saw its leading position in mutual fund asset management advance further from 16 percent to 20 percent, and its share in the stock market trading business grow from 13 percent to 16.5 percent. At group level, which includes Balkan subsidiaries, lending grew 22.2 percent and deposits 2 percent. The net interest margin (net interest income to average assets) remained above 3 percent, while a rise in operating costs in Greece was limited to 3.9 percent. Non-performing loans were trimmed to 2.8 percent of the total from 2.9 percent in 2002. As regards foreign operations, Eurobank augmented its interest in Romania’s Banc Post to 53 percent, boosted its stake in Bulgaria’s Post Bank to 92 percent and acquired 68 percent of Serbia’s Postbanka – later rising to 91 percent after a share capital increase – which was renamed EFG Eurobank Beograd. The bank reported under Greek accounting principles (GAAP) and said it will adopt International Accounting Standards in the first quarter of 2005. Attica The Bank of Attica group reported a 70 percent jump in income after tax and minorities to 19 million euros, with interest income rising 19 percent, and commission income 26.2 percent. The bank booked total provisions of 38 million euros. Lending jumped 36 percent to 1,484.2 million euros, with the mortgage segment surging 70 percent; consumer credit advanced 22 percent. Attica’s total deposits and repos rose 23.6 percent to 1,700.9 million euros. The bank opened three more branches, bringing the total to 59, as well as a venture capital subsidiary, Attica Ventures.

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