Hellenic Bank saw its profits increase in the first half of 2022 to €55.4 mln, from €21 mln in the same period last year, reducing its non-performing loans further, and sticking to its transformation roadmap.
The island’s second largest lender said that during the first six months of the year, €556 mln of new loans with healthy risk-return profile were granted, compared to €388 mln in the same period last year, up 43%.
The bank said it maintained a strong capital adequacy ratio of 21.9%, (pro-forma), well above the regulatory requirements, and ample liquidity with a Liquidity Coverage Ratio of 473%.
Its pro-forma CET1 ratio stood at 19.6%, while its pro-forma NPE ratio was 10.2%. When excluding the NPEs covered by the agreement to sell its debt servicing platform, APS, the ratio was further down at 3.6%.
APS sale
Hellenic Bank’s key event in the first six months of the year was the agreement to sell a €700 mln (gross) package of NPEs as well as its bank servicing platform, the APS Debt Service, to Oxalis Holding S.A.R.L. through “Project Starlight”.
“Despite this challenging environment, Hellenic Bank performed well above expectations, making solid progress towards its strategic goals”, said its CEO Oliver Gatzke.
He said that the bank remains committed to its 2022-2024 Strategic Plan to transform and address structural challenges, with increased focus on digitalisation and cost control.
“Despite the progress, we remain watchful and particularly wary about the challenges that lie ahead, that is why we have been consistent and intensively working on improving the quality of our portfolio,” Gatzke said.
“Project Starlight, related to the sale of a €700 mln of gross non-performing loan portfolio and the agreement with RCB to acquire a performing loan portfolio, significantly reduced our pro-forma NPE ratio to c.3,6%, one of the lowest among peers,” he said.
Positive prospects
The bank’s CEO argued that Hellenic’s 3-year transformation journey is on track.
“We aim to enhance customer experience, increase revenues, whereas at the same time drive efficiency.
“We are in the process of transforming into a customer-centric organisation, by improving customers’ experience, through digitalisation, streamlining of our processes and offering simple and competitive products,” Gatzke said.
He added that the rising interest rate environment is expected to support main indicators in the mid-term, allowing the institution to focus on healthy new lending with a sufficient return profile.
