March 20, 2018 / 4:26 PM / a month ago

Greece's Alpha Bank swings to loss on voluntary redundancy costs

ATHENS (Reuters) - Greece’s Alpha Bank (ACBr.AT) slipped into the red in the fourth quarter after booking costs related to a voluntary retirement plan and fixed asset impairments.

FILE PHOTO - A man withdraws money at an Alpha Bank branch ATM in central Athens, Greece, July 19, 2015. REUTERS/Yiannis Kourtoglou

Alpha, 11 percent owned by the country’s bank rescue fund HFSF, reported on Tuesday a net loss from continuing operations of 64 million euros (£45.7 million) after a net profit of 35.6 million euros in the third quarter.

Greece’s fourth-largest lender by assets booked one-off costs of 92.7 million euros for a voluntary redundancy scheme and a 76.1 million euro annual fixed asset impairment charge in the fourth quarter, squeezing its bottom line.

Greek banks are scrambling to shrink their problem loan portfolios and meet targets agreed with regulators. The country’s long recession pushed unemployment to record highs, making it hard for many borrowers to service debts.

Banks entered the 2008 global financial crisis with bad loans, or so-called non-performing exposures (NPEs), of 14.5 billion euros, or about 5.5 percent of their loan books. But bad debts climbed to 106.9 billion euros, or 51 percent, by last year.

Banks have agreed with regulators to cut the level to 66.7 billion euros by 2019, bringing the ratio down to 34 percent.

    “In 2017 we took a number of decisive actions to derisk our balance sheet,” Chief Executive Dimitris Mantzounis said in a statement.

    He said the sale of more than 400 million euros of NPLs (non-performing loans) in Romania and the disposal of a 3.7 billion euro portfolio of Greek retail unsecured NPLs reflected the bank’s focus on cleaning up its balance sheet.

    “Throughout 2018 we will continue to focus on reducing NPLs in line with our targets, eliminating ELA (emergency liquidity assistance) support and making our franchise leaner and more efficient,” the CEO said.

    Alpha’s ratio of NPLs - loans overdue by more than 90 days - came down to 34.9 percent of its book from 37.3 percent at the end of September.

    Provisions for sour debt fell 18.3 percent quarter-on-quarter to 244 million euros from 298 million euros in the third quarter.

    Reporting by George Georgiopoulos; Editing by Susan Fenton

    0 : 0
    • narrow-browser-and-phone
    • medium-browser-and-portrait-tablet
    • landscape-tablet
    • medium-wide-browser
    • wide-browser-and-larger
    • medium-browser-and-landscape-tablet
    • medium-wide-browser-and-larger
    • above-phone
    • portrait-tablet-and-above
    • above-portrait-tablet
    • landscape-tablet-and-above
    • landscape-tablet-and-medium-wide-browser
    • portrait-tablet-and-below
    • landscape-tablet-and-below