Hellenic Bank posts €18m in after tax loss in first three quarters

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Hellenic Bank, the third-largest Cypriot lender, announced an after-tax loss of €17.8m in the first nine-months of 2017 compared to a €5m profit in the respective period of last year.

The worsening of profitability was mainly on an increase in provisions to €85.3m in January to September against €64.1m in provisions in the respective period of 2016, the lender said on Thursday. Net interest income dropped to €99.2m from €110.7m respectively.

The bank, which in July launched APS Debt Servicing, a joint venture with the Prague-based APS Holdings, to manage its non-performing loan stock and real estate assets, said that the ratio of its delinquent loans dropped for the eighth consecutive quarter to €2.3bn in September or 55.7 per cent of total loans from €2.5bn or 58.2 per cent in December last year. The coverage ratio of provisions was 61.4 per cent.

The lender said that its core equity tier 1 (CET1) ratio stood at 14.45 per cent at the end of the third quarter against a regulatory requirement of minimum 9.25 per cent. The capital adequacy ratio stood at 18.12 against a minimum 12.75 per cent set by the regulator.

“We made further progress in materialising our strategic priorities in the third quarter of 2017,” the bank’s top executive Ioannis Matsis said. “The capital basis of the group remains strong”.

Matsis said that the impact of the implementation of the international financial reporting standard 9 in January next year will have an impact of more than €25m and less than €50m on the bank’s capital compared to June 2017.

A voluntary retirement scheme announced by the bank recently will help reduce costs and improve the bank’s cost-to-income ratio, of 63.9 per cent in September compared to 57.9 per cent a year before, Matsis said. The lender is introducing a new organisational structure in an attempt to improve customer service and reduce costs.

In the first nine months of 2017, the bank extended €334m in fresh lending, Matsis said.

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Stelios Orphanides is a journalist at CyprusBusinessMail.com. To contact Stelios Orphanides: [email protected]

  • Barry White

    @CM worth taking another look at para. 7.

    If the Hellenic cost to revenue ratio rose to “63.9 per cent in September compared to 57.9 per cent a year before, Matsis said….”, this not an improvement but a disaster and indicating serious problems for the Bank in the short time with manning and costs out of control.

    Perhaps and hopefully Matsis is misquoted as to this ‘triumph’, or worse and very worrying he isn’t misquoted.

  • Bob Ellis

    Quoting figures out of context is meaningless. If the dodgy figures quoted here are the best they could find. as many have suspected the Helenic is FUBAR. Although all the banks seem to be in a similar, if not worse, poisiton.