THE BANK of Cyprus Group yesterday released its results for the first nine months of the year announcing pre-tax profits of £61.1 million ( 106 . 5 million) compared to £67 million for the same period last year, a decrease of 8.8 per cent.
Profit after tax reached £41.2 million compared to £45.9 million for the same period in 2000, a 10.2 per cent drop.
The bank nevertheless said the results were considered ” satisfactory”in the light of conditions prevailing in the Cypriot and Greek banking sectors, and were comparable with results announced by the other Greek banks.
” The interest rate cuts coupled with the September 11 terrorist attack and the events, which followed, have changed the financial environment. These exogenous factors have adversely affected the results of the period,”the announcement said.
The bank said the 8.8 per cent fall in the Group’s pre-tax profit was mainly due to the successive interest rate cuts both in local and in foreign currency, as well as the drop in commissions from foreign currency exchange and in profits from foreign currency trading resulting from the introduction of the euro in Greece.
In addition, the continuing decline in the Cypriot and Greek stock markets and the international recession also had an adverse effect on the Group’s profitability, a statement said, especially following September 11. In addition, the Group’s results were negatively impacted by the initial set- up costs of its subsidiary bank in Australia and of a significant number of new branches in Greece.
” The results of the whole year of 2001 will depend to a large extent on the developments in the international markets; in any case, though, it is expected that the results will remain to be satisfactory under the conditions prevailing,”the bank said.
The Group’s total assets as of September 30 2001 reached £7.3 billion, recording an increase of £1.0 billion or 16.2 per cent since the beginning of the year. A similar increase (16.6 per cent) was recorded on the Group customer deposits.
” Of particular importance is the increase in customer deposits in Greece, which reached £1.4 billion as of 30 September 2001, compared to £0.8 billion at December 31, 2000, recording a 73 per cent increase,”the announcement added.
The bank’s branch network in Greece now comprises 50 branches, compared to 31 at the beginning of the year. The network is expected to increase to 60 branches by the end of 2001. The Group added to its capital base £200 million from share capital issued in Greece in October 2000 and275 million from the issue of subordinated loan stock qualifying as Tier II capital in June 2001.
” The Group’s £360 million stronger capital base places the Group in an advantageous position regarding its efforts to achieve its strategic targets, to face the adverse environment prevailing in the market and to grasp the opportunities that may arise,”the bank said.
