ECONOMY

NBG dragged down by adverse trading results

National Bank of Greece, the largest bank in Greece, said yesterday that consolidated profits before tax and after minorities took a sharp plunge in 2001 as a result of the prolonged stock market downturn, offsetting robust organic growth in its core retail banking sector. Consolidated profits before tax and after minorities fell by 28.8 percent to 698.7 million euros last year from 980.6 million euros in 2000. Group after-tax profits slid to 484 million euros from 718 million euros, marking a 32.6-percent drop. Manos Giakoumis of P&K Securities said the decline in consolidated profits and improvement in core operating profits were expected. «National Bank’s organic growth in 2001 was encouraging,» he said. The market rewarded the bank’s core improvement, lifting NBG’s shares by 1.07 percent to 24.48 euros yesterday. The bank said that discounting trading results, consolidated profits would have risen by 18.5 percent. It said that core banking activities accounted for 79.6 percent of total revenues, up from 62.8 percent in 2000. Reflecting the prolonged market slump, NBG’s trading activities posted a 51.3-percent drop in consolidated revenues to 390 million euros last year from 801 million euros in 2000. Commission revenues also suffered from the decline in underwriting activities, down by 7.6 percent to 339 million euros. Giakoumis said the drop is less significant than other major banks, reportedly suffering double-digit falls. Retail banking proved to be an engine of growth last year for NBG, with interest revenues rising by 22.1 percent to 1.11 billion euros and net interest revenues up by 23.8 percent to 897.2 million euros. Group net interest margin improved to 2.44 percent from 2.19 percent. The bank reported a 15.7-percent jump in loans on group level last year on the back of the mortgage, and consumer and credit card boom, up 23.7 percent and 37 percent respectively. NBG which has branches in 17 countries, said overseas operations are fast proving their worth as they accounted for 12.3 percent of consolidated pretax profits and after minorities in 2001 or 86.1 million euros against 42.7 million drachmas in 2000. The bank said it intends to propose a dividend of 1.10 euros per share at the forthcoming annual general meeting, up from 1.09 euros in 2000.