Marfin Popular raises profit forecast

Marfin Popular Bank has raised its profit forecast for 2008 and 2009 with the average growth in profitability now estimated at 39.6% and significant improvements noted in other ratios.

Earlier, Marfin Popular CEO Andreas Vgenopoulos had raised the 2007 net profit forecast from EUR 360 mln to EUR 420 mln, including the EUR 50 mln exceptional gain booked on the sale of stakes in Hellenic Bank and Universal Life.

During investor briefings in London, Marfin Popular Bank proceeded with new revisions to its future profits. Specifically, 2008 profits are now seen reached EUR 526 mln compared to the previous forecast of EUR 470 mln, while net profit in 2009 are now seen climbing to EUR 669 mln, up sharply from the previous estimate of EUR 600 mln.

The earnings figure has not taken into account expected fee income from Marfin Investment Group (MIG), which has just kicked off the process of its EUR5.19 bln share capital increase.

Loans are seen climing 26.7% every year from EUR 16 bln in 2007 to EUR 19.8 bln in 2008 and EUR 23.9 bln in 2009. Deposits are seen climbing 25% year-on-year from EUR 21.9 bln in 2007 to EUR 26.5 bln in 2008 and EUR 32 bln by 2009.

The cost to income ratio, which for 2007 is seen at 44.9% is forecast to continue to decline to 41.6% in 2008 and 38.2% in 2009. The net interest margin is seen hovering in a range of 2.89% to 3.05%, while Non-Performing loans are forecast to decline from 5.3% of loans in 2007 to 3.8% by 2009.

Return on tangible equity (RoTE) will grow from 19.5% to 24.4% and return of assets (RoA) from 1.50% to 2.01% by 2009.

Andreas Vgenopoulos, Group CEO, commented that the Group’s first-quarter 2007 results, latest expectations for 2007 earnings, and the successful integration process of the three banks, which is expected to be completed by the end of June, necessitate the revision of the business plan. “The new revised business plan determines the targets for a healthy growing three-year period”, Mr. Vgenopoulos said, pointing out that in that way shareholders, employees, and customers will benefit.

Marfin Popular Bank’s business plan was presented at an investor day in London on May 17, 2007 by Lefteri Hiliadaki, Deputy CEO, Thimios Bouloutas, Deputy CEO, Christos Stilianidis, Deputy CEO, Matteo Stefanel, Head of Investment Banking and Dimitris Spanodimos, Head of Group Corporate Strategy.