Alpha warns of poor Q1 results
Alpha Bank head Yiannis Costopoulos yesterday confirmed market suspicions that the banking sector is set to post less-than-satisfactory first-quarter results when he said that his bank expects sharply lower figures for the first three months of the year. Addressing shareholders at the annual general meeting, Costopoulos said that Alpha Bank, in common with other banks, should see significantly reduced first-quarter profits compared with the same period last year, when results «were very good.» Such pessimism is connected to the prolonged stock market downturn, said Vassilis Vlastarakis, analyst at Contalexis Financial Services. He said that Alpha Bank and its erstwhile suitor National Bank of Greece as well as Piraeus Bank are expected to suffer more from stock market blues than the other major banks. «A big chunk of Alpha and National’s profits in 2000 came from trading income. In the first quarter of 2001, trading gains continued to grow strongly. The absence of activity this year will hit the banks hard,» he said. Alpha Bank posted trading profits of 267 million euros in 2000, which slid by 55 percent to 119 million euros in the following year. Close to 39 percent of last year’s trading gains were recorded in the first three months of the year. Despite the bad start to the year, Costopoulos said he was cautious about the rest of 2002. Analysts, however, said the banking sector is not likely to see any improvement ahead. Contalexis’s Vlastarakis said trading activities are not expected to pick up this year and that «a rally is forecast for 2003 onward as investors discount the benefits of the 2004 Olympic Games and major infrastructure projects come close to completion.» Investment banks Morgan Stanley and UBS Warburg in reports issued last month were similarly downbeat on the Greek banking sector, predicting a recovery only in 2003. Costopoulos also expressed regrets over Alpha’s failed merger with National Bank, saying that faults on both sides had led to the fiasco. «Only the combination of Alpha and National Bank would have created a pan-European bank,» he said. The deal, unveiled last November, collapsed less than two months later as a result of discord over the division of top jobs. Shareholders at yesterday’s meeting approved a dividend of 0.91 euros per share, payable April 16. Alpha shares trade ex-dividend today. The stock fell by 2.89 percent yesterday compared with a 3.88 percent drop for the banking sector and a 2.96 percent decline in the general share index. «In the eurozone of the 21st century, we cannot hope to catch the ‘big fish’ without adapting, immediately and forcefully, the education and training systems for the Greek citizens to the requirements of this development,» Tsochadzopoulos said.
