ECONOMY

In Brief

Eurobank outpaces sector’s growth in nine months EFG Eurobank-Ergasias, Greece’s third-largest lender by assets, reported a 43.6 percent rise in nine-month group net profit, broadly in line with market expectations, boosted by robust loan volumes. The group said yesterday that net profit after minorities rose to 273 million euros ($351 million), reporting under Greek GAAP. Lending volumes outpaced the sector during the period. Total loans grew 26.5 percent year-on-year – compared to the sector’s 16 percent – driven by consumer loans and mortgages, which expanded by 40.7 percent to 9.1 billion euros. Business loans grew 17.1 percent year-on-year to 11.3 billion. Strong lending growth saw net interest income grow by 19.6 percent to 751 million euros. Net interest margin remained above 3.0 percent. Fee and commission income was up 23 percent, driven by mutual fund, asset management and capital market activities. Eurobank, which will pay an interim 2004 dividend per share of 0.30 euros, said return on average equity reached 18.7 percent, while its return on equity corresponding to a capital adequacy ratio of 8.0 percent was 22.5 percent. Deposits, including repos, rose 13.8 percent to reach 16.2 billion euros, outpacing the sector’s 10.2 percent growth rate. The group’s cost-to-income ratio was 48.6 percent. (Reuters) Rebranding and competition hurt Stet Hellas’s nine-month profits Mobile phone company Stet Hellas, which operates under the TIM trademark, reported a 19 percent fall in nine-month group net profit to 58.2 million euros yesterday, hit by rebranding costs and price cuts. The country’s third-largest mobile service provider by users said EBITDA fell 6.3 percent to 196.4 million euros. Revenue grew 6.2 percent to 644.7 million euros, due to increased traffic and higher handset sales. A rebranding exercise, regulator-ordered price cuts, the launch of 3G services and competition from other carriers «are hurting the company’s short-term profitability,» Stet said in a statement. The results were based on US GAAP. The company said it had 2.41 million users at the end of September, of which 1.6 million, or 66.3 percent, were prepaid clients and the remaining contract customers. Tellas The Public Power Corporation (PPC) is seeking a more active involvement in the Greek telecommunications market, encouraged by the success of its subsidiary Tellas which has exceeded forecasts in its first 18 months. Management is reported to be seriously considering buying out the total of the controlling interest in Tellas held by Italian partner Wind (50 percent plus one share). Tellas was expected to turn profitable in 2006 or 2007, but provisional figures for the first nine months of 2004 are already showing a pretax profit. Equally impressive is Tellas’s market penetration, projected to reach 700,000 landline customers by the year’s end. Wind is reported to be contemplating exiting the Greek market. OTE Transport and Communications Minister Michalis Liapis said after meeting employee representatives yesterday that the government would seek implementation of a voluntary retirement scheme for more than 4,000 staff at OTE Telecom in a climate of consensus «without which you cannot pursue effective policies.» OTE is expected to table its final proposals in the next few days.