Bourses blamed as Laiki Group’s profits fall

NICOSIA (Reuters) – Cyprus financial company Laiki Group said yesterday pretax profit fell to 2.09 million pounds (3.63 million euros) in 2001 from 69.13 million in 2000, hit by poorly performing Cypriot and Greek stock markets. Preliminary 2001 accounts showed the group flipped to a loss after tax of 13.04 million pounds last year from 45.17 million pounds gained after tax in 2000, which was boosted by the spin-off of Laiki Investments. Laiki, which offers banking, finance and insurance services, is 22 percent owned by Britain’s HSBC bank. Last year’s results were depressed by a 40.64-million-pound loss on disposal and revaluation of securities and a 34.5-percent increase in bad debt provisioning to 17.7 million pounds. Operating profits before the investment revaluation declined to 60.5 million pounds from 82.9 million in 2000. The group, Cyprus’s second largest domestic bank, said its profits were affected by a slowdown on the Athens and Nicosia stock exchanges, little new business for its insurance divisions and a decline in revenue from foreign exchange activity due to the introduction of the euro. A jump in provisioning was largely generated in its Cypriot operations. «The Cypriot economy has been affected considerably by the events of September 11 and the negative performance of the bourse,» the group said in a statement. Laiki has units in Greece, Britain, Australia and representative offices in South Africa and Canada. It expanded into electronic banking over the past year. It would propose a final dividend of three cents per share in addition to the interim dividend of five cents, or 16 percent, up from 14 percent in 2000. The group said it planned to introduce a dividend reinvestment scheme this year, offering shares at a discount of 10 percent. Laiki shares closed two cents higher to 1.27 pounds on the Cyprus bourse yesterday. «If Deutsche Telekom would post an offer for line-sharing on the billboard, Brussels would be happy,» a source said.

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