Bank of Cyprus announces 1.371 bln losses for 2011

The Bank of Cyprus announced that its losses after tax amounted to 1.371 bln euros for 2011, following the impairment of Greek Government Bonds by 74%, according to the Bank’s final audited financial results announced on Tuesday.

Losses are increased by 360 mln compared to the 1,011 bln the Bank announced two months ago in its preliminary financial results, when the reduction of GGBs nominal value was estimated at 60%.

The pre-tax impairment of GGBs, including related hedging costs, amounted to 1.729 mln for 2011, which represents 83% of their nominal value. At December 31, 2011 the book value of GGBs post impairment amounted to 616 mln.

Profit before provisions and the impairment of GGBs reached 805 mln, noting an increase of 11%, compared to 725 mln for 2010. Profit after tax, excluding the impairment of GGBs, reached 312 mln compared to 306 mln for 2010, noting an increase of 2%. Including the impairment of GGBs, losses after tax amounted to 1.371 mln.

The Group notes that it has achieved the profitability targets set for 2011, excluding the impairment of GGBs, despite the continuing negative economic developments in the main markets in which it operates, achieving increased profit before provisions and increased profit before tax and impairment of GGBs for 2011.

As for the 2012 prospects, the Group adds that it takes all necessary measures to be in a position to face the challenges of the uncertain economic environment.

In the current environment, it is noted, the Group continues to focus on maintaining its organic profitability, healthy liquidity, satisfactory capital adequacy and effective risk management.