Bank of Cyprus 1H08 profit seen up 8%

Bank of Cyprus (BOCY) is on track to meet its full year guidance of EUR 540 mln in net profit for 2008, is what the bank’s management is expected to say when the first half results are announced on Thursday.
It is also expected to add that its investment in Russia, where it bought 80% of Uniastrum Bank for EUR 371 mln, is healthy and offers a promising future. Bank of Cyprus, meanwhile, is conducting roadshows to drum up interest for its recently announced 10-year convertible bond issue worth EUR 573 mln.
Investors are awaiting with interest the announcement of the first half results for confirmation that Bank of Cyprus is on track to meet its targets, but also to compare with other financial institutions now releasing their first half and second quarter results abroad.
According to reports provided by analysts and compiled by the Financial Mirror, Bank of Cyprus first half profits are expected to range between EUR 235 mln to 247 mln.
Analysts at HSBC are forecasting profit growth of 8% to EUR 247 mln compared to the first half in 2007, while on a quarterly basis, the second quarter profits are seen up 6% to EUR 131 mln. HSBC is maintaining its “overweight” bias and price target of EUR 14.5 per share.
Euroxx analysts see Bank of Cyprus 1H08 profit up 5.3% to EUR 242.3 mln, while other forecasts range from EUR 235-240 mln.
In the first quarter of 2008, Bank of Cyprus reported EUR 116.05 mln in net profit, up 9.3% compared to EUR 106.17 mln in 1H07.
Based on its total 2008 forecast of EUR 540 mln and prevailing price of EUR 8.00 trading on the CSE, the price to earnings ratio is around 8.5 times according to Financial Mirror calculations. With the bank’s book value at EUR 3.6/share, the price to book value is calculated at 2.2 times based on Financial Mirror estimates.
Bank of Cyprus has a market cap of EUR 4.5 bln and trades both on the Cyprus Stock Exchange and the Athens Stock Exchange. It is Cyprus’ largest lender with a significant presence in Greece, Russia, Romania, as well as in the UK and Australia.