Erste Group Bank AG
Erste Group Bank AG: Erste Group increases 2010 net profit by 12.4% to EUR 1,015.4 million on strong operating result and lower risk costs
Erste Group Bank AG / Key word(s): Preliminary Results/Preliminary Results Erste Group increases 2010 net profit by 12.4% to EUR 1,015.4 million on strong operating result and lower risk costs Highlights: Erste Group posted its best ever operating result at EUR 3,987.9 million in 2010 (+5.7% compared to 2009). Record operating income of EUR 7,804.7 million (+3.0% on the previous year) and stable operating expenses of EUR 3,816.8 million (+0.2% vs. 2009) contributed to this success. Correspondingly, the cost/income ratio continued to improve from 50.2% to 48.9% in 2010. The positive trend in net interest income and net commission income more than offset the decline in the net trading result. A rise in interest-bearing assets underpinned the 3.7% rise in net interest income to EUR 5,412.5 million. Most notably, net commission income increased by a significant 9.2% to EUR 1,936.0 million in 2010 due to higher fees from securities business and payment transfers. Following the exceptionally strong performance in 2009, the net trading result expectedly declined by 22.0% to EUR 456.2 million. Risk costs declined in 2010 by 1.2% to EUR 2,031.2 million or 155 basis points of average customer loans (2009: EUR 2,056.6 million or 161 basis points). Despite the notable reduction in new NPL formation compared to 2009, the NPL ratio based on customer loans increased from 6.6% to 7.6% in 2010. Compared to the previous quarter, the NPL ratio remained stable for the first time since Q2 08.The NPL coverage ratio improved to 60.0% from 57.2% as at 31 December 2009. Net profit after minorities * rose by 12.4%, from EUR 903.4 million to EUR 1,015.4 million in 2010 despite the negative impact of items such as the Hungarian banking tax, which amounted to EUR 49.8 million (pre-tax) in 2010. Cash return on equity decreased from 9.7% to 8.2% as a result of the significantly enlarged capital base. Total assets grew by 2.1% to EUR 205.9 billion in 2010. Customer business gained in importance on the asset as well as the liability side: as a result of exchange rate volatility customer loans grew by 2.8% to EUR 132.7 billion (year-end 2009: EUR 129.1 billion), while customer deposits rose to EUR 117.0 billion (+4.4% vs. EUR 112.0 billion at year-end 2009). The loan-to-deposit ratio improved to 113.4% (year-end 2009: 115.3%). Deposits by banks continued to decline significantly, falling by 23.4% to EUR 20.2 billion and reflecting the diminishing importance of wholesale short-term funding. Erste Group's capital base continued to improve in 2010, driven in particular by rising profitability. In 2010 shareholders' equity ** rose by 6.9% to EUR 13.6 billion compared to year-end 2009. Alongside stagnant loan volumes, total risk-weighted assets declined from EUR 123.9 billion at year-end 2009 to EUR 119.8 billion. This resulted in a Tier 1 ratio (total risk) of 10.2% (year-end 2009: 9.2%) and a core Tier 1 ratio (total risk) of 9.2%, up from 8.3% at year-end 2009. As a result of solid profitability, the management board of Erste Group will propose an unchanged dividend of EUR 0.65 (2009: EUR 0.65) to the Annual General Meeting on 12 May 2011. *The term net profit after minorities corresponds to the term net profit attributable to owners of the parent. ** The term shareholders' equity corresponds to the term total equity attributable to owners of the parent. End of Corporate News 25.02.2011 Dissemination of a Corporate News, transmitted by DGAP – a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. DGAP’s Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de |
Language: | English | |
Company: | Erste Group Bank AG | |
Graben 21 | ||
1010 Wien | ||
Österreich | ||
Phone: | +43(0)5 0100 – 10100 | |
Fax: | +43(0)5 0100 9 – 10100 | |
E-mail: | info@erstegroup.com | |
Internet: | www.erstegroup.com | |
ISIN: | AT0000652011 | |
WKN: | 909943 | |
Listed: | Freiverkehr in Berlin, Hamburg, München, Stuttgart; Open Market in Frankfurt; Wien (Amtlicher Handel / Official Market) | |
End of News | DGAP News-Service |
113457 25.02.2011 |