Cyprus Mail

Co-op banks post €55m in net earnings in H1

By Stelios Orphanides

The state-owned Cooperative Central Bank said that it generated an after tax profit of €55m in the first six months of 2016 compared to €46.7m in the respective period of 2015 as it continues to struggle with persistent bad loans.

COOP LOGOThe bank, which received a capital injection of €1.5bn in 2014 before receiving additional €175m in taxpayers’ money in December, said that its capital adequacy ratio stood in June at 16.4 per cent compared to a required core equity tier 1 capital ratio of 12.3 per cent set by the regulator.

The Cooperative Central Bank, which the government intends to privatise via several stages of capital increase over the next years, said that its non-performing loan ratio dropped marginally to 59.3 per cent in June from 59.4 per cent in December or to €7.3bn from €7.6bn respectively.

Loan restructurings worth €668m in the first half of the year helped the bank reduce its ratio of 90 days past due loans to 48.2 per cent in June from 51 per cent in December with the coverage ratio seen at 54 per cent, the bank said.

The bank said that its customer deposits dropped to €12.5bn in June from €12.7bn in December while total gross loans fell to €12.3bn from €12.7bn respectively. Gross loans include a total of €3.2bn in provisions for loan impairments which the bank increased by €10.5m in the second quarter and by €10.2m in January to March.

HadjiyiannisThe Cooperative Central Bank’s chief executive officer Nicolas Hadjiyiannis said that the bank’s earnings are confirmation of the efforts made to help the co-op banks to cope with the constantly changing environment at home and abroad.

“In the improved domestic environment, we aim to continue managing past due loans in their full spectrum, increasing fresh healthy lending to sound private and business investment, maintaining of high liquidity, strengthen the capital basis and improve the quality of our balance sheet,” he said.

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