2001 NINE MONTH RESULTS | Eurobank
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2001 NINE MONTH RESULTS

SIGNIFICANT GROWTH in LOANS (24%), DEPOSITS (27%) and ASSETS (27%) 7% RISE in ORGANIC REVENUE RECOVERY OF COMMISSION INCOME IN 3Q 6% INCREASE in NET PROFIT.

2001 NINE MONTH RESULTS
(According to International Accounting Standards)SIGNIFICANT GROWTH in LOANS (24%), DEPOSITS (27%) and ASSETS (27%) 7% RISE in ORGANIC REVENUE RECOVERY OF COMMISSION INCOME IN 3Q 6% INCREASE in NET PROFITEFG Eurobank Ergasias announces consolidated financial results for the nine months to September 30th of 2001 under International Accounting Standards (IAS) and Greek Accounting Standards (GAS). There are marginal differences in the nine- month 2001 figures under IAS and GAS. In the first nine months of the year 2000 such differences were more material and were, among others, due to differences in the consolidation of the former Bank of Crete and in the valuation of the trading portfolio, including derivatives. All figures and growth rates mentioned below are under IAS, which better reflect the Group’s financial condition.In the nine months to September 30 2001, consolidated profit before tax attributable to the shareholders of EFG Eurobank Ergasias increased marginally reaching € 253 million, from € 251 million in the nine months of the previous year. Consolidated net profit after tax and minorities increased by 6.4% reaching € 173 million, compared to € 163 million in the same period a year earlier. Group profit before tax and minorities declined by 6.8% to € 263 million from € 282 million in the nine months of 2000.One year after the merger of Eurobank with Ergobank, EFG Eurobank Ergasias’ focus on organic growth is reflected in strong business volume growth rates, a sustained high net interest margin in the context of intense competition, as well as a recovery of commission and fee income in the 3rd quarter, despite adverse stockmarket conditions. At the same time, EFG Eurobank Ergasias undertakes important initiatives to enhance revenues through the exploitation of cross-selling capabilities, control costs and improve the quality of services offered. In the nine month period of 2001 Total Assets increased by 27% to € 20.6 billion, from € 16.2 billion, reflecting continuous robust growth in business volumes. This was driven by the significant growth of 24% in Loans and advances to clients, which reached € 9.9 billion, from €7.9 billion, and the increase of 27% in Customer Deposits, which reached € 15.5 billion, from € 12.2 billion at the end of September 2000.The increase in loans by 24% y-o-y remains one of the fastest in the market. Specifically, consumer credit was up by 54% and mortgage credit increased by 37%, while small business loans (SBLs) grew by 47% y-o-y. Continued rapid growth has brought retail lending to 41% of the total loan portfolio at the end of the nine- month period of 2001, from 35% at the end of September 2000. Total loans and advances to clients account for 48% of total assets and 64% of customer deposits.Customer Deposit growth of 27% is also among the fastest in the market. Total Deposits reached € 15.6 billion, of which € 6 billion were Repos. Customer Assets Under Management, at current prices, rose by 7% amounting to € 21 billion. This rise was achieved despite the further significant drop in the value of domestic equity portfolios in 2001.Net Interest Income increased by 25% in line with loans, with the loan growth reaching € 444 million. The net interest margin (net interest income over avg. total assets, annualised) remained above 3%, signalling the strong position of the group in the market’s most profitable segments. The rise in net interest income more than offset the 19% contraction of net fee and commission income. Therefore, Core Banking Revenue (net interest income and net fee and commission income), increased by 8.5% relative to the nine-month period of 2000, and reached € 616 million, from € 567 million. Core banking revenue contributed 89% of Total Operating Income, compared to 85% in the same period of the previous year.Nine month 2001 results were burdened by the 19% contraction of Net Fee and Commission income, which reached € 171 million, from € 212 million. Stock market related commissions fell considerably and their contribution to total commissions was restricted to less than 15%, from approximately 30% last year, as trading activity in the ASE in the first nine months of 2001 was 63% lower compared to that of the corresponding period in 2000. However, it should be noted that intense group efforts to strengthen commission and fee income in all sectors led to a significant increase of 36% in total fees and commissions in the third quarter of the year in comparison to the previous quarter (from € 47 million in the second quarter to € 64 million).Net Trading Income was also adversely affected by the conditions prevailing in the Athens Stock Exchange, since the ASE General Index closed at 2,226 at the end of the third quarter against 2,736 at the end of the first semester (-18%). This fact led to realised and unrealised equity trading losses, which were however offset by gains on bonds, derivatives and foreign exchange, and resulted in total trading gains of € 17.6 million, against € 7 million in nine months 2000. For the same reasons Gains less losses from other securities which relate to realised gains and losses from the held-to-maturity and the available-for-sale portfolios decreased by 58% to € 26.1 million, from € 62 million in the same period of 2000.Despite the decrease of non-interest income by 19%, Total Operating Income rose by 4.7% to € 693 million, from € 664 million in the nine months of 2000. Excluding the aforementioned equity gains and extraordinary gains from real estate, Organic Operating Income rises by 7% to € 639 million, from € 684 million.The effort to further enhance the Group’s competitiveness is also reflected in the deceleration in the expansion of Operating Costs. Containment of personnel and administrative expenses to an increase of 8.1% (against 8.6% in the first half of the year) allowed for the substantial improvement in the cost-to-average assets ratio to 2.7% from 3.0% in the same period of 2000. Operating cost was significantly burdened by the 29% increase in depreciation of IT and infrastructure investments, which ensure long term efficiency gains.The quality of the loan portfolio remains at high levels, despite the strong growth in loans. NPLs from Group activities remain below 3% of the total loan book and including NPLs from the acquisitions of the Bank of Athens and the Bank of Crete, which are fully covered by provisions, allows total NPLs to stay at 4.0% of the total loan portfolio. Total provisions cover more than 80% of total NPLs, which is one of the highest ratios in the Greek banking sector.The Capital Adequacy Ratio remains very strong at 14% confirming the ability of the Group to maintain high growth rates, without having to resort to shareholders in order to raise new capital in the foreseeable future. Return on average Equity (ROE) pre tax increased to 18.6%, while Return on average Assets (ROA) before tax remained among the highest in the sector (1.9%). Return on average Equity (ROE) after tax stood at 12.8% and Return on average Assets (ROA) after tax was 1.3%.Greek GAAP (GAS) and International Accounting Standards (IAS)EFG Eurobank Ergasias has long opted for reporting its financial results according to IAS and GAS simultaneously, focusing however the analysis of these results in the statements prepared according to IAS. Financial statements and results based on IAS fully reflect the group’s financial position, and allow for comparisons with other banks worldwide. On the other hand GAS are restricted by Greek tax legislation. The European Commission requires listed companies in the Union to publish financial statements under IAS by 2005 the latest. In summary, GAP and IAS differ in the accounting principles followed, for instance the valuation methods, the time of recognition of forward transactions on securities and dividends payable and in the way financial data are presented. In the banking sector the main differences are found in the treatment of leasing, bond gains and in the presentation and evaluation of bond, equity and derivative portfolios. There are marginal differences in the nine- month 2001 figures under IAS and GAS. In the first nine months of the year 2000 such differences were more material and were, among others, due to differences in the consolidation of the former Bank of Crete and in the valuation of the trading portfolio, including derivatives. Differences in the figures of the previous accounting period lead to different growth rates in 2001.According to Greek GAAP, the results for the Group of EFG Eurobank Ergasias are as follows: Total Assets amounted to € 19,5 billion, from € 16.5 billion. Loans and advances to clients (excluding leasing) reached € 9.6 billion, from € 7.7 billion. Customer Deposits exceeded € 15.6 billion, from € 12.2 billion at the end of September 2000. Net Interest Income (excluding leasing income and bond gains) amounted to € 424 million from € 324 million, while the net interest margin remains above 3%. Core Banking Revenue (net interest income and net fee and commission income), reached € 600 million from € 555 million. Total Operating income stood at € 749 million, from € 764 million. Consolidated net profit after tax and minorities reached € 167 million, from € 195 million the same period a year earlier.

EFG EUROBANK ERGASIAS key figures under IAS
(€, mn)
9-m 20019-m 2000 Δ %
BALANCE SHEET
Net Loans & advances to customers9,8787,97423.9%
Deposits15,47112,17927.0%
Shareholders Equity1,7361,795-3.3%
PROFIT & LOSS
Total Assets20,60516,21227.1%
Net Commission Income172212-19.0%
Total Operating Income6966644.7%
Net Interest Income44435525.1%
Organic Income6846397.0%
Pre tax Profit after minorities2532510.5%
Net Profit after tax & minorities1731636.4%

EFG EUROBANK ERGASIAS key figures under
GAP (€, mn)
9-m 20019-m 2000Δ%
BALANCE SHEET
Total Assets6.6485.62318,2%
Net Loans & advances to customers3.2802.63424,5%
Deposits5.3104.16627,5%
Shareholders Equity632,1671,2-5,8%
PROFIT & LOSS
Net Interest Income144,5110,430,9%
Net Commission Income59,978,8-23,9%
Core banking revenue 204,4189,28,0%
Total Operating Income255,4260,2-1,8%
Pre tax Profit82,195,9-14,4%
Net Profit after tax & minorities 57,066,4-14,2%