Τ BANK Α.Τ.Ε.
Press Release - Earnings As At H1 2009
Key financial figures of ASPIS BANK Group
The highlights of ASPIS BANK Group, for H1 2009 are summarized as follows:
Total assets, increased by 1% to euro 2.65 billion versus euro 2.62 billion at the end of 2008.
Loans net of provisions, decreased by 5.6% to euro 2 billion versus euro 2.1 billion at the end of 2008.
Customer deposits, increased by 11% to euro 2.21 billion versus euro 1.99 billion at the end of 2008.
The loan-to-deposit ratio reached 94.7%.
Operating expenses decreased by 21% to euro 44.6 million versus euro 56.3 million in H1 2008.
Loss after tax and minority interest, amounted to euro 30.5 million.
Total capital adequacy ratio is estimated at 8.8% (consolidated basis) and 10.4% (non consolidated basis).
With the economic environment still changing, ASPIS BANK unimpeded implements its strategic plans, which have timely been re-adjusted based on the deteriorating conditions.
Following the enhancement of liquidity through targeted actions such as the completion of the securitization of euro 424 million residential mortgage loans, and the significant increase of customer deposits compared to the end of 2008, ASPIS BANK is in the next phase of its strategy. In order to achieve growth, the Bank focuses on the strengthening of its capital adequacy. Towards that, the Extraordinary Meeting of ASPIS BANK's Shareholders resolved to increase the share capital via cash payment with a pre-emption right in favour of the existing shareholders at a ratio of 2 new to 1 old share, aiming at raising funds of euro 120 million. Depending on the economic and capital market conditions at the time of the relevant resolution of the Bank's Board of Directors the offer price may be set at levels that will lead to higher funds raised. Furthermore, the Bank's shareholders resolved to decrease the par value of the Bank's ordinary registered shares to euro 0.60 from euro 2.71 each, which will precede the share capital increase.
At the same time the rationalization and reduction of operating expenses program continues unimpeded, the results of which have a positive effect on the Bank's financial performance.
During Q2 2009 targeted actions to increase the Bank's penetration in the consumer credit market have been taken. Towards that, an innovative product, ASPIS One MasterCard was launched to the market. Simultaneously, the recently developed private banking activities (ASPIS Premium Banking) are growing. The network of Business Centers, which supports the Bank's SMEs financing activities, is expanding. The recently established business center network counts 2 such centers and is expected to expand to 5 by the end of 2009.
The slowdown in economic activity imposed the containment of Banks activities and the readjustment of the provisioning policy, which increased significantly in order to immunize the Bank against future potential losses. Financial performance was negatively affected by these factors, and loss after tax and minority interests amounted to euro 30.5 million.
Review of Group Balance Sheet
Total assets increased by 1% ytd, reaching euro 2.65 billion. Given the slowdown in economic activity, ASPIS BANK maintained its conservative lending policy and increased provisions for loan losses. Thus, loans net of provisions decreased by 5.6% ytd to euro 2 billion. Targeted actions of the Bank to enhance consumer credit growth continued unimpeded. Credit cards and consumer loans, which account for 7% of ASPIS BANK Group loan portfolio, increased by 8% ytd and by 18% yoy respectively. Loans to small and medium sized enterprises decreased by 8% ytd as a result of low economic activity and the application of stricter credit criteria.
Customer deposits increased by 11% to euro 2.21 billion versus euro 1.99 billion at the end of 2008. The loan-to-deposit ratio reached 94.7%, which is satisfactory given the market conditions, and ensures the Bank's capacity for growth.
Given the reported losses, the Group total equity decreased by 19% ytd to euro 132 million. The group total capital adequacy ratio is estimated at 8.8%. Following the successful completion of the impending share capital increase, the capital adequacy ratio will substantially be strengthened to one of the highest ratios in the Greek banking market.
Review of Group results
The ASPIS BANK Group recorded losses after taxes and minority interests of euro 30.5 million as a result of the suppression of the Bank's activities which was not offset by the reduction interest expenses and operating expenses by 21%.
Net interest margin, which has been suppressed during 2009, is being improved compare to the first months of 2009, due to the de-escalation of deposit interest rates and interbank market interest rates. The de-escalation of interest rates resulted in the reverse of the upward trend of interest expenses during the last quarters. In specific, interest expenses decreased by 2% in relation to H1 2008. Nevertheless, interest expense reduction could not offset the reduction of interest income. Consequently, net interest income decreased to euro 7 million versus euro 23 million in H1 2008.
The containment of the Bank's operations has resulted in a reduction of net commission income by 23% to euro 9 million versus euro 12 million in H1 2008. Profits from financial transactions amounted to euro 1.8 million versus losses of euro 0.8 million in H1 2008.
The uninterrupted implementation of the Bank's program for rationalization and reduction of operating expenses resulted in a reduction of operating expenses by 21% to euro 44.6 million. Administrative expenses decreased by 11% to euro 15.9 million versus euro 17.8 million in H1 2008 as a result of reduction of all expenses categories. Staff expenses decreased by 31% to euro 22.5 million versus euro 32.7 in H1 2008, which had been burdened with one-off expenses. Depreciation increased to euro 6.15 million versus euro 5.7 million in H1 2008.
Provisions as a result of the readjustment of provisioning policy and the adverse economic climate increased by 49% and reached to a total of euro 16 million versus euro 11 million in H1 2008.
Following the successful completion of the forthcoming share capital increase and given the enhanced liquidity and the readjusted provisioning policy, the Management of ASPIS BANK is optimistic to return to profitability.
The highlights of ASPIS BANK Group, for H1 2009 are summarized as follows:
Total assets, increased by 1% to euro 2.65 billion versus euro 2.62 billion at the end of 2008.
Loans net of provisions, decreased by 5.6% to euro 2 billion versus euro 2.1 billion at the end of 2008.
Customer deposits, increased by 11% to euro 2.21 billion versus euro 1.99 billion at the end of 2008.
The loan-to-deposit ratio reached 94.7%.
Operating expenses decreased by 21% to euro 44.6 million versus euro 56.3 million in H1 2008.
Loss after tax and minority interest, amounted to euro 30.5 million.
Total capital adequacy ratio is estimated at 8.8% (consolidated basis) and 10.4% (non consolidated basis).
With the economic environment still changing, ASPIS BANK unimpeded implements its strategic plans, which have timely been re-adjusted based on the deteriorating conditions.
Following the enhancement of liquidity through targeted actions such as the completion of the securitization of euro 424 million residential mortgage loans, and the significant increase of customer deposits compared to the end of 2008, ASPIS BANK is in the next phase of its strategy. In order to achieve growth, the Bank focuses on the strengthening of its capital adequacy. Towards that, the Extraordinary Meeting of ASPIS BANK's Shareholders resolved to increase the share capital via cash payment with a pre-emption right in favour of the existing shareholders at a ratio of 2 new to 1 old share, aiming at raising funds of euro 120 million. Depending on the economic and capital market conditions at the time of the relevant resolution of the Bank's Board of Directors the offer price may be set at levels that will lead to higher funds raised. Furthermore, the Bank's shareholders resolved to decrease the par value of the Bank's ordinary registered shares to euro 0.60 from euro 2.71 each, which will precede the share capital increase.
At the same time the rationalization and reduction of operating expenses program continues unimpeded, the results of which have a positive effect on the Bank's financial performance.
During Q2 2009 targeted actions to increase the Bank's penetration in the consumer credit market have been taken. Towards that, an innovative product, ASPIS One MasterCard was launched to the market. Simultaneously, the recently developed private banking activities (ASPIS Premium Banking) are growing. The network of Business Centers, which supports the Bank's SMEs financing activities, is expanding. The recently established business center network counts 2 such centers and is expected to expand to 5 by the end of 2009.
The slowdown in economic activity imposed the containment of Banks activities and the readjustment of the provisioning policy, which increased significantly in order to immunize the Bank against future potential losses. Financial performance was negatively affected by these factors, and loss after tax and minority interests amounted to euro 30.5 million.
Review of Group Balance Sheet
Total assets increased by 1% ytd, reaching euro 2.65 billion. Given the slowdown in economic activity, ASPIS BANK maintained its conservative lending policy and increased provisions for loan losses. Thus, loans net of provisions decreased by 5.6% ytd to euro 2 billion. Targeted actions of the Bank to enhance consumer credit growth continued unimpeded. Credit cards and consumer loans, which account for 7% of ASPIS BANK Group loan portfolio, increased by 8% ytd and by 18% yoy respectively. Loans to small and medium sized enterprises decreased by 8% ytd as a result of low economic activity and the application of stricter credit criteria.
Customer deposits increased by 11% to euro 2.21 billion versus euro 1.99 billion at the end of 2008. The loan-to-deposit ratio reached 94.7%, which is satisfactory given the market conditions, and ensures the Bank's capacity for growth.
Given the reported losses, the Group total equity decreased by 19% ytd to euro 132 million. The group total capital adequacy ratio is estimated at 8.8%. Following the successful completion of the impending share capital increase, the capital adequacy ratio will substantially be strengthened to one of the highest ratios in the Greek banking market.
Review of Group results
The ASPIS BANK Group recorded losses after taxes and minority interests of euro 30.5 million as a result of the suppression of the Bank's activities which was not offset by the reduction interest expenses and operating expenses by 21%.
Net interest margin, which has been suppressed during 2009, is being improved compare to the first months of 2009, due to the de-escalation of deposit interest rates and interbank market interest rates. The de-escalation of interest rates resulted in the reverse of the upward trend of interest expenses during the last quarters. In specific, interest expenses decreased by 2% in relation to H1 2008. Nevertheless, interest expense reduction could not offset the reduction of interest income. Consequently, net interest income decreased to euro 7 million versus euro 23 million in H1 2008.
The containment of the Bank's operations has resulted in a reduction of net commission income by 23% to euro 9 million versus euro 12 million in H1 2008. Profits from financial transactions amounted to euro 1.8 million versus losses of euro 0.8 million in H1 2008.
The uninterrupted implementation of the Bank's program for rationalization and reduction of operating expenses resulted in a reduction of operating expenses by 21% to euro 44.6 million. Administrative expenses decreased by 11% to euro 15.9 million versus euro 17.8 million in H1 2008 as a result of reduction of all expenses categories. Staff expenses decreased by 31% to euro 22.5 million versus euro 32.7 in H1 2008, which had been burdened with one-off expenses. Depreciation increased to euro 6.15 million versus euro 5.7 million in H1 2008.
Provisions as a result of the readjustment of provisioning policy and the adverse economic climate increased by 49% and reached to a total of euro 16 million versus euro 11 million in H1 2008.
Following the successful completion of the forthcoming share capital increase and given the enhanced liquidity and the readjusted provisioning policy, the Management of ASPIS BANK is optimistic to return to profitability.