Piraeus earnings exceed expectations

Piraeus Bank, Greece’s fourth- biggest lender, said first-half profit advanced 30 percent, beating market expectations, on strong loan growth from international operations. Net income rose to 283.8 million euros from 219 million euros a year earlier, the company said, against analysts’ forecasts of 280.8 million euros. The year-ago figure does not include gains of 153.3 million euros from the sale of the company’s holding in Bank of Cyprus, the island’s biggest lender. «Annual loan growth in Greece for the first half of the year was 33 percent, while abroad the corresponding rate was 88 percent,» the bank said. Piraeus Bank is opening more branches in Greece, Egypt and southeastern Europe to tap rising demand for home and consumer loans. The expansion is expected to boost profit to more than 600 million euros this year and 1.2 billion euros in 2010. The company reaffirmed that forecast yesterday. Operating costs stemming from the expansion climbed 24 percent to 412 million euros. Piraeus now has some 832 branches in 10 countries, including Bulgaria, Romania and Egypt. It plans to increase the network to about 1,200 branches by 2010. Ratings agency Fitch upped its rating on Piraeus Bank earlier this week to ‘A-‘ from ‘BBB+’ citing the lender’s improving franchise in Greece and selected southeastern European operations, increased capital base and good risk management.