Hellenic Bank has announced its profits for the first half of the year.
The financial institution's performance was successful.
In particular, from January to June 2024, Hellenic Bank earned 189 million euros, an increase of 18 per cent compared to the same period in 2023. According to the financial institution, its profitability was boosted by high interest rates on loans and deposits, as well as debt securities.
The net interest margin (annualised) for the first half of 2024 was 3.28%, compared with 2.41% a year earlier, positively impacted by the increase in net interest income. Net interest income from January to June totalled € 304.4 million (+29%), compared with € 235.4 million in the first half of 2009.
On the other hand, total non-interest income decreased by 1% to € 57.4 million in the first half of 2008 from € 58 million in the same period of 2007. The decline was also mainly due to lower net income from fees and commissions (€ 34.4 million). The return on equity (ROTE) was 24%, with a net book value per share of € 3.99 at the end of June 2024, compared to € 3.54 at the end of December 2023.
At the end of the first quarter, the bank's total expenses increased to € 145.2 million, up 15% from € 126.1 million in the first half of 2009, mainly due to higher administrative and other expenses and personnel expenses. On a quarterly basis, total costs increased by 4%.
Personnel expenses (2,256 employees) totalled € 65.4 million for the period under review, compared to € 60.7 million in the first half of 2009. General and administrative expenses for the first six months totalled € 69.6 million, an increase of 29% compared to € 54 million in the first six months of 2023. The ratio of expenses to income was 40.1 per cent, compared to 43 per cent a year earlier.
Hellenic Bank's customer deposits stood at €15 billion at the reporting date of 30 June 2024 (31 March 2024: €14.9 billion and 31 December 2023: €15.3 billion) and have remained at the same level since the first quarter of 2024, although down 2 per cent compared to 31 December 2023. The bank's deposit market share was 28.2% at 30 June 2024, compared with 28.7% at 31 March 2024 and 29.4% at 31 December 2023.
The net loan-to-deposit ratio was 39.8% at 30 June 2024, compared with 40.3% at 31 March 2024 and 39.4% at 31 December 2023. At the same time, the Bank zeroed out central bank funding at the end of June and started repaying borrowings through the ECB's €2.4 billion Targeted Long-Term Refinancing Operations (TLTRO III).
Gross borrowings stood at €6bn at 30 June 2024, compared with €6.16bn at 31 March 2024 and €6.17bn at end-December 2023. Hellenic Bank's loan market share was 25.1% at 30 June 2024, down from 25.8% at end-December 2023.
New borrowings totalled € 472 million, down 27% year-on-year. Red loans totalled € 411 million at 30 June 2024, compared to € 450 million at 31 March 2024 and € 464 million at 31 December 2023, down 11% year-on-year and 9% from Q2 2024. Problem loans under the Asset Protection Programme totalled € 100 million.
The bank's main results:
- Profit for the first half of 2024 - € 189 million, up 18% year-on-year.
- Stable capital base - adjusted Common Equity Tier 1 (CET1) ratio of 26.55% and adjusted total capitalisation of 32.19%, well above regulatory minimums.
- Balance sheet risk mitigation - NPL ratio (excluding NPLs covered by the Asset Protection Programme) at 2.4%, NPL coverage ratio (excluding NPLs covered by the Asset Protection Programme) at 39%.
- Agreement with CNP Assurances for CNP (Cyprus Insurance Holdings) to create the largest insurance company in Cyprus.
- Framework agreement for the extension of the collective labour agreement.
- New borrowing of € 472 million for the first half of 2024.
- A retail-focused bank with a stable customer base and a significant market share among households (36% in deposits and 33% in loans).
- Upon completion of the mandatory public offer, Eurobank will become the majority shareholder with a 56% stake.