Hellenic Bank Cyprus FY08 profit down 75%, final dividend 2c

Hellenic Bank Public Company Ltd (HB.CY) released its FY08 preliminary financial results, posting a 75% year on year decline in net profit attributable to shareholders to EUR 33.97 mln compared to FY07 profit of EUR 133 mln, while in the fourth quarter, the Bank reported a loss of EUR 28 mln.
Nevertheless, the Bank declared a final dividend of 2 cent per share, which together with the interim dividend already declared and paid, raises the total dividend for 2008 to 7 cent per share.
Total net income decreased by 24%, as a result of the decline in noninterest income, reaching EUR243.mln. The figure includes, realized and unrealized gains from investments and ForEx trading, resulting to a loss of EUR30.4 mln compared to a profit of EUR29.2mln in the corresponding 2007 period. According to Management, this was mainly the result of the unfavourable conditions in the capital markets which also resulted to EUR12mln unrealised losses of the Group’s subsidiary, Athena Investments, which since 2007 is treated as an associate company.
On the cost side, total expenses increased by 1%, with cost to income ratio standing in at 65.3% compared to 48.9% in FY07. Provisions increased significantly to EUR39.7mln compared to EUR12.8mln in 2007, despite the Group’s efforts to improve the quality of its loan portfolio. On the other hand, NPLs reduced from 8.1% to 6.9%. On the loan side, total loans reached EUR5 bln (up 22%), while on the deposit side the increase stood at 5% to EUR6.1 bln, with loans to deposits ratio reaching 81.6% compared to 69.8% in 2007. There was also a deterioration in the Group’s Capital adequacy ratio to 11% compared to 13.7% a year earlier. The Group’s ROE was significantly down to 7.04% compared to 30% in the year 2007. Equity attributable to the Company’s shareholders reached EUR440.4 mln compared to EUR525 mln in 2007, showing a 16% decrease on a yearly basis and an 11% decrease on a q-o-q basis.