Agricultural Bank offers no dividend

State-controlled Agricultural Bank of Greece (ATE) said yesterday that it will not be paying a dividend for 2001 but will instead use profits to shore up its capital base. The decision came on the heels of a 16.3-percent fall in pretax profits last year and a heavy weight of nonperforming loans amounting to a hefty 2 billion euros (700 billion drachmas). The bank said net pretax profits last year fell to 206.2 million euros from 246.4 million euros, due to one-off expenses and lower extraordinary revenues. ATE governor Petros Lambrou said the bank will propose a zero dividend to shareholders at the forthcoming general assembly, with profits ploughed back into the organization in order «to reinforce ATE’s capital.» ATE’s capital fell by 4.7 percent last year to 1.7 billion euros after a sharp fall in the value of its bond portfolio. He said the bank has set aside provisions of 944 million euros (332 billion drachmas) to cover all kinds of risks, including non-performing loans estimated at 2 billion euros. Loans last year rose by 14.4 percent to 11.39 billion euros (3.9 trillion drachmas), with the biggest jump reported in mortgage and consumer loans, up 105 percent and 60 percent respectively. Deposits including repos increased by 9.5 percent to 14 billion euros (4.75 trillion drachmas). Net interest revenues edged up by 22 percent to 479 million euros. Lambrou said the bank plans to strengthen its financial profile by divesting its 12 noncore subsidiaries, among which are dairy manufacturers Agno, Rodopi and Dodoni, Hellenic Duty-Free Shops, Hellenic Sugar Industry, cigarette firm SEKAP, and ATE Leasing via flotations or strategic alliances. ATE also plans to expand its customer base, a course already evident last year as 44 percent of loans given out went to customers other than farmers. The bank head said ATE will continue its quest for a strategic investor, either abroad or locally. The state has said it plans to bring down its current 85-percent holding to a minimum 35 percent via a convertible bond issue and equity offerings to agricultural cooperatives and retail investors. The bank listed some 15 percent of its equity on the market early last year.

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