“Overall, the bank is performing well, particularly given the current environment, demonstrating the potential power of the group once it is unshackled from the high levels of non-performing exposures,” Hellenic said in an emailed statement on Tuesday.
The bank said that its non-performing exposures dropped to 58.3% of its loan portfolio in the first quarter from 59.2% at the end of the financial year 2015, while its common equity tier 1 capital ratio fell to 13.8% from 14.75% respectively. The coverage ratio fell to 49.1% from 50%. In absolute figures, the value of non-performing loans fell 3% to €2.5bn from €2.6bn.
In January to March, the bank extended a total of €84m in fresh lending to customers and restructured loans worth €160m, the statement said. Loans and advances to customers rose marginally to €3.1bn in a quarter.
The drop in net earnings in the first three months of the year was mainly on reduced interest income which fell to €46.9m from €47.9m the previous quarter and €65.7m in the first quarter of 2015, the bank said. Non-interest income fell in the first quarter to €22m from €43.1m the quarter before mainly due to the €16.7m gain from the sale of government securities in the fourth quarter of the year.
“Despite moving into a low interest rates environment Hellenic Bank’s net interest margin increased from 2% at year end to 2,1%,” at the end of March, the bank continued. “The improvement is the result of the continued repricing of the deposits and the income generated from the new exposures”.
Hellenic booked €21.6m in provisions for loan impairments to in the first quarter against €41.6m the quarter before and €13.1m in the first quarter of 2015.
Hellenic Bank reduced its total expenses in the first quarter to €37m from €37.9m the quarter before or 2%, mainly on a quarterly 8% drop in administrative and other expenses to €15m which offset a 1% quarterly increase in its wage bill to €20.6m, reflecting an increase in personnel to 1,580.
Hellenic saw its cash balance increase a quarterly 8% to €2.2bn in March, as its customer deposits fell 2% to slightly over €6bn.
Source: Cyprus Mail
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