AstroBank posts €21.7 million profit for 2022

AstroBank on Wednesday released its annual results for 2022, reporting strong profitability for the year, with net income reaching €12.2 million, and consequently increasing common shareholders’ equity to €203.7 million.

According to the results, AstroBank’s profitability represents a 6.2 per cent return on average equity, while its capital adequacy ratio stands at 18 per cent. Net income excluding non-recurring items stood at €21.7 million.

“The systematic efforts of AstroBank during the last two years towards a focused business model, streamlined operations, and resolution of legacy issues, have supported very strong financial results,” AstroBank CEO Aristidis Vourakis stated.

“With capital of over €200 million, extensive presence across the country, and an updating digital offering AstroBank stands to play a central role serving Cyprus entities and individual customers,” he added.

Moreover, AstroBank reported a net income for the year 2022 of €12.2 million. This compares with €3.3 million for the year 2021.

Excluding non-recurring items of €9.5 million, consisting of €7.6 million of Servicer‘s Settlement Fees and €1.9 million in Voluntary Retirement Scheme Costs (€0.7 million for 2021), profit for the year stands at €21.7 million, compared to €3.9 million in 2021.

The bank’s reported net income represents a return on average equity of 6.2 per cent, compared to 1.7 per cent in 2021.

Total operating income was reduced from €74.2 million to €72.7 million, representing a 2 per cent reduction.

There was an increase of 6.5 per cent in net interest income, rising from €48.1 million to €51.2 million, and a largely stable net fee income of €16.9 million. These were offset by a decline in other income, which fell from €9.1 million to €4.6 million. The reduction mainly reflects the gains from the Byblos Branch acquisition in 2021 and investment valuation adjustments in 2022.

Total operating expenses declined from €56.1 million in 2021, to €49.6 million in 2022, representing a reduction of 11.8 per cent.

The reduction mainly reflects the elimination of servicer administration fees as a result of the acquisition of NPE Servicer and is partially offset by an increase in other administrative costs.

Employee costs have remained stable, despite the impact of an annual increment increase, as a result of overall cost control efforts. Depreciation remained on a downward trend.

Furthermore, pre-provision income stood at €23.1 million in 2022, compared to €18.0 million in 2022.

Provisions and valuation adjustments stood at €3.7 million, compared to €13.4 million the year before, reflecting improving recoveries from the bank’s non-performing exposures (NPEs).

Additionally, a €2.7 million deferred tax asset, in relation to prior year losses, has been recognised in 2022, supported by the improving underlying profitability of the bank.

What is more, AstroBank’s total assets as of December 31, 2022, amounted to €2.726 billion, reduced from €3.018 billion in 2021, mainly attributed to the partial repayment of the funding from the European Central Bank (ECB), through the TLTRO programme by approximately €200 million.

In regard to its ESG actions, the bank said that it is committed to operating in an economically and socially sustainable manner.

According to the bank, an ESG working plan has been established with significant improvements in the Governance Pillar and an expanding effort on the Environmental Pillar accompanying AstroBank’s Social Pillar commitment.

“AstroBank remains committed to quality and efficient delivery of its services to its corporate and retail clients fully utilising the functionalities allowed by Digital Transformation,” the bank said in a statement.

“In the fourth quarter of 2023, a number of new initiatives will be in production including a new mobile app and internet-based digital channel and full digitisation of the bank’s card offerings,” it added.

“Those initiatives accompany a range of digitisation and integration of internal processes releasing client facing capacity,” the bank concluded, noting that “with the integrated new digital platforms and its 15 locations strong network AstroBank aims to play a key role in the Cyprus banking sector”.