Hellenic Bank issues positive profit warning

Hellenic Bank issued a positive profit warning for its second quarter financial results scheduled to be announced on 29 August 2007, adding that based on preliminary indications, first half profits are expected to be significantly better than the EUR 26.2 mln profit reported in the first half of 2006.

The Bank stated that its consolidated results for the second quarter and first half 2007 will be significantly higher compared to the results a year ago for both respective periods. In 1Q07 HB recorded a net profit of CYP 14.4 mln.

According to the Bank the substantial improvement is due mainly to the further improvement of the quality of its loan portfolio, profits arising from the acquisition of Athena Investments Pcl, as well as profits from revaluation of specific interest rate derivatives.

The Bank’s Board meeting on 29 August 2007 will also revise the targets set in HB’s

Strategic Plan 2007-2009 since the targets set in February have been surpassed.

Sharelink Securities & Financial Services Research said that part of the aforementioned profits may not be recurring. For 1H 2007 Sharelink project PAT of EUR56.0 mln.

For the full year 2007, Sharelink currently maintain their PAT projections at EUR107 mln (2006A: EUR59 mln), which translates to a RoE of 25.0%. Currently Sharelink also maintain their price target on HB at EUR5.15/share.

Recall that in May 2007, the Group’s Management has revised upwards the Group’s strategic targets for 2007 for the RoE and the cost to income ratio compared to the previously announced targets at the end of February 2007. The revised RoE and cost to income targets for 2007 as announced in May are 23.0% (previously: 16.4%), and 52.0% (previously: 57.5%), respectively.