Hellenic Bank announces reduced profits

Hellenic Bank, the second largest lender and the biggest in retail banking in Cyprus, announced reduced profits on Monday for the first nine months of this year, mainly on account of a negative impact from the acquisition of Cyprus Cooperative Bank (CCB).

A statement by the Hellenic Bank said its net profit in the first nine months of 2019 amounted to 89.4 million euros (99 million U.S. dollars) in comparison to 295.3 million euros in the same period of 2018.

The statement said a “negative surplus” amounting to 297.9 million euros was taken into consideration in the bank’s accounts as a result of the acquisition of the CCB operations.

It added that this amount was the difference between the cash value of 74.2 million euros paid for the purchase of CCB and the net reasonable value of the property assets acquired and the obligations undertaken by the bank.

In the integration, which started in the summer of 2018 and was completed in September this year when the last cooperative branches were absorbed by Hellenic Bank, the lender purchased the best part of CCB’s operations. The CCB acted as the collective banker for tens of local cooperative credit societies established in the span of a century by local communities.

Hellenic Bank said that at the end of September the value of non-performing loans held by the lender was reduced by 6 percent to 2.339 billion euros from 2.474 billion euros at the end of December 2018.

In a statement issued ahead of the announcement of its results, Hellenic Bank urged the owners of non-performing loans to take advantage of, and apply in time to join, the “Estia” plan, which is aimed at reducing bad loans.

The government and the banks had said that they expected to receive up to 10,000 applications by the deadline at the end of the year, but Hellenic Bank said it had received only 100 applications up to now.

The Bank of Cyprus, the biggest Cypriot lender, said it had received only about 500 applications. (1 euro = 1.11 U.S. dollars)