.jpg)
The Bank of Cyprus Group reported very satisfactory first half results, at the top end of the range of estimates maintaining high levels of profitability and return on equity and continuing the dynamic growth of its operations in the new geographic markets with positive results despite the negative global environment.
The investments of the Group in the new markets are expected to yield significant future benefits in the coming years, in terms of business growth as well as profitability.
Specifically, for the first half 2008 profit after tax reached EUR244 mln, up 6% compared to EUR229 mln for the first six months of 2007 and achieving a return on equity of 24,4%. The Group maintained its efficiency with the cost to income ratio remaining at low levels (43,6%) for the first half 2008 despite the significant investment for further expansion of the network in Greece, and also the cost of the development of operations in Russia, Romania and Ukraine. The ratio of non-performing loans to total loans improved to 3,6% at 30 June 2008 from 4,6% at 30 June 2007 and from 3,8% at 31 December 2007. The Group’s loan portfolio and deposits grew by 28% and 9% respectively. This performance is in line with the targets of the Group’s three year strategic plan 2008-2010.
Prospects
The Group is focused on the implementation of its strategy of autonomous growth and further significant growth rates in both volumes and profits. The financial performance to date is in line with the targets of the Group’s three year strategic plan 2008-2010.
The Group is taking measures to offset the negative impact from the continuous pressure on liability spreads. Such measures include the repricing of selected loan products, the faster expansion of the Group in the new markets with higher margins and the enhancement of other income.
In parallel the dynamic expansion of the Group in the new markets creates a new dimension for the Bank of Cyprus Group. The fast growing Russian market with which the Group maintains long term relations through the provision of international banking services in Cyprus and our experience in this market encouraged us to speed up our expansion process. The agreement for the acquisition of the Russian Uniasturm Bank is an important step for the Group creating significant prospects for its profitability and at the same time ensuring the geographic and by sector diversification of its operations.
