Erste Group sees Q1 profit grow 26.8 pct to almost EUR 333 mln

Ovidiu Posirca 04/05/2018 | 10:10

Austrian Erste Group, the parent of BCR, said its net profit grew by 26.8 percent to almost EUR 333 million in the first quarter of 2018 compared to the same period of last year on the back of an increase in lending and deposit volumes.

The group recorded an increase in the net interest income and net fee and commission, while the net trading result fell. The operating income slightly grew to EUR 1.65 billion, while general administrative expenses rose by 4.6 percent to EUR 1 billion.

“The increase of our cost base in the first quarter was due to the strong inflow of deposits, which led to substantially higher contribution to the Deposit Insurance Fund and to higher personnel expenses due to the raising wages as a result of the strong economic development in our region, especially in Czechia and Slovakia.

Our capital situation remains very strong at EUR 14.4 billion. The slight decrease of 30 basis points and its impact on our Basel 3 fully loaded ratio, which now stands at 12.5%, reflects the fact that retained earnings are traditionally not accrued in the first quarter and the effects of implementing the IFRS 9 accounting standard,” said Andreas Treichl, CEO of Erste Group Bank AG, in a statement.

The bank’s total assets gained 4.2 percent to EUR 230 billion.

Loans and receivables to customers rose by 1.8 percent to EUR 142.1 billion. On the liability side, deposits from banks increased to EUR 21.0 billion and customer deposits continued to grow slightly – most notably in the Czech Republic and in Austria – to EUR 155.3 billion. The loan-to-deposit ratio stood at 91.5 percent.

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