Raiffeisen Q4 profit surprises analysts
With the EUR 205 mn Q4 profit, Raiffeisen closed 2020 with consolidated profit of EUR 803 mn, 35% lower than in 2019.
The decrease in profit is almost directly attributable to a single factor, increased loan provisions due to the coronavirus crisis. The bank made net loan provisions of EUR 630 mn last year, compared to EUR 234 mn in 2019. Meanwhile, the ratio of non-performing loans has not increased.
Raiffeisen offset lower interest income by cutting costs. Net interest revenue was down 5% year on year and net fees and commissions were 3.2% lower, whereas operating costs decreased by 5% compared to 2019.
In euro terms, the bank’s stock of loans decreased by 0.6% last yer while deposits grew 6.1% and its balance sheet total increased by 9%.
Further details from the press release:
- Core revenues impacted by rate cuts, lockdown measures, and weaker currencies in most CEE countries
- General administrative expenses down 5% year-on-year
- Loans to customers slightly down in EUR terms, mainly due to currency effect
- Provisioning ratio of 0.68%, 42 bps higher year-on-year mainly from Stage 2 provisioning
- Slight improvement in NPE ratio and NPE coverage ratio to 1.9% and 61.5% respectively
- CET1 ratio at 13.6%, including deduction of the originally communicated dividend proposal for 2019(42 bps) and the proposed dividend for 2020 (20 bps)
- In consideration of the ECB’s recommendation on dividend payments RBI’s Management Board has decided to propose a dividend distribution of EUR 0.48 per share to the Annual General Meeting (scheduled for 22 April 2021). The Management Board may consider an additional dividend distribution once the ECB’s recommendation on dividend payments has been lifted.
The data contained in this release is based on unaudited figures and do not contain data for the subsidiaries. On 17 March 2021, RBI will publish its full 2020 Annual Report including further details on the business year and the outlook.
Raiffeisen
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