July 31, 2018 / 6:36 AM / 8 months ago

UPDATE 1-Erste Group Q2 net profit beats expectations helped by Eastern Europe

(Adds further financial details, CEO comment)

July 31 (Reuters) - Austrian lender Erste Group on Tuesday reported a 21 percent increase in second quarter net profit, helped by stronger income from payment services, asset management and lending.

For the first time in four years, the company was able to increase its operating result at half year level, which stood at 1.30 billion euros, owing to strong performance in Eastern Europe.

Net profit in the three months to June 30 rose to 438.2 million euros ($513.18 million) from 362.5 million euros a year earlier, topping the 393 million euros expected by analysts in a Reuters poll.

“We expect this positive trend in our operating performance to continue in the second half of 2018, based on the persisting outperformance of CEE economies, with low unemployment rates, rising real wages and increasing economic competitiveness,” Chief Executive Andreas Treichl said.

The company reiterated its full-year outlook of a return on tangible equity (ROTE) of above 10 percent, based on growing revenue, falling expenses due to lower project-related costs and risk costs remaining at historically low levels.

$1 = 0.8539 euros Reporting by Bartosz Dabrowski; editing by Nick Macfie and Jason Neely

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