Piraeus Bank posted pre tax profit of €125mn in Q2.2020. Net interest income was up by 1% yoy, at €727mn. Net fee income stood at €151mn, +3% yoy, while operating expenses declined by 10% yoy on a like-for-like basis at €428mn. Reported pre-provision income reached €470mn, +17% yoy and impairments increased to €670mn in H1.20, driven by €341mn Covid-19 related charges that incorporate the impact of the new macroeconomic environment to the Bank’s portfolio.
Excluding the aforementioned Covid-19 impact for H1.2020, pre-tax profit stood at €126mn compared to €57mn in the same period last year.
New loan disbursements stood at €3.5bn year-to-date, covering increased credit demand, while Total Bank participation in the "Guarantee Fund for Covid-19” reached €1.0bn; on top, €0.4bn financing through the "TEPIX II” programme for new lending to impacted SMEs. Loans under moratoria to performing customers stood at €4bn, supporting them to address liquidity issues due to Covid-19 outbreak. Private sector deposits were up by €0.8bn in H1.2020.
Commenting on the results Christos Megalou, Chief Executive Officer said: "In the second quarter of the year, we faced what we hope to be the peak of the pandemic crisis, along with the gradual unwinding of the restrictive measures, while in June, the opening of various sectors of the economy gathered pace. Throughout this period, we continued placing the utmost emphasis on the safety of our clients and our employees.
Piraeus Bank provided support to its clients by granting new loans of €3.5bn year-to-date, covering heightened credit demand. In cooperation with the Hellenic Development Bank, Piraeus participated in the "Guarantee Fund for Covid-19”, aiming to facilitate SMEs and Corporates with €1.0bn working capital, and
in the "TEPIX II” lending facility, providing financing of €0.4bn. Piraeus Bank is prepared for the new installment subsidy program for impacted borrowers for their outstanding primary residence mortgages.
The Bank’s loans under debt moratoria granted to performing customers amount to €4bn. New demand for moratoria is gradually flattening out, given the State sponsored facilities that have become available.
Asset quality trends remain on track with the proactive measures we have taken. During the second quarter of the year, we reduced the NPE stock by €0.8bn. On top, we continue working on the inorganic part of our NPE strategy. On the €2bn Phoenix mortgage NPE securitization, pre-rating has been assigned confirming
senior tranche size, while on the €5bn Vega transaction, business plan and pre-rating phase are under way.
Furthermore, in late July we have received a binding offer for the €0.6bn Iris unsecured NPE portfolio. Our capital position has improved in the second quarter of 2020. Total regulatory capital ratio was at 16.0% on a phased-in approach compared to 15.1% in March 2020, with the CET1 ratio at 14.0% vs 13.1% in the
Piraeus Bank recorded solid results in H1.2020. Net interest income and net fees grew by +1% and +3% yearon-year respectively, while operating expenses on a like-for-like basis were reduced by 10% year-on-year. Pre-provision income stood at €470mn, up 17% growth compared to the same period last year. Impairments
increased to €670mn in H1.20, driven by €341mn Covid-19 related charges. All in all, pre-tax result stood at a loss of €215mn having incorporated the pandemic impact in H1.2020; when excluding this, pre-tax profit was €126mn.
We continue working on the Bank’s transformation plan to be fully rolled out by Q4 this year. Our aspiration calls for a lean, efficient, de-risked and profitable bank for the benefit of our shareholders, employees and the Greek economy, and we remain committed in attaining this goal.”