VIENNA, Feb 11 (Reuters) - Bank Austria, the central and eastern European (CEE) arm of Italian bank UniCredit, aims to increase its market share in the region as rivals scale back, it said on Thursday, while reporting a return to profit in 2014.
“Due to our ongoing investments in the CEE region we have gained market shares in most countries and intend to continue doing so in the future, while competitors are deleveraging,” CEE chief Gianni Franco Papa said in a statement.
“Without doubt geopolitical tensions and hesitant recovery in the euro area are going to be the main challenges in the upcoming quarters. In this difficult environment the CEE division is strongly positioned for future growth and to remain a key contributor to our banking group.”
UniCredit, Italy’s biggest bank by assets, met its full-year profit target on Wednesday but its shares fell on news its core capital weakened slightly and that it will pay a scrip dividend for the second year in a row.
UniCredit said its core capital ratio, a key measure of financial strength, stood at 10.02 percent, down from 10.4 percent at the end of September and lagging analyst estimates.
Bank Austria, which is market leader in CEE ahead of Raiffeisen Bank International and Erste Group , saw its common equity tier 1 capital ratio fall to 10.3 percent of risk-weighted assets at end-2014 from 11.3 percent a year earlier.
Its fourth-quarter net profit shrank to 191 million euros from 416 million in the third quarter, while its full-year profit rebounded to 1.38 billion from a loss amid writedowns in 2013.
Raiffeisen Bank International reported a 2014 loss of nearly 500 million euros and is retrenching heavily in the region to boost its capital buffers.
Erste Group Bank has forecast a record 2014 loss of up to 1.6 billion euros amid hits from Romania and Hungary.
Reporting by Michael Shields
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