![]() |
![]() |
![]() |
![]() |
![]() |
![]() |
![]() |
![]() |
. | ![]() |
. |
|
. |
![]()
by Staff Writers Vienna (AFP) Nov 24, 2011
One of central and eastern Europe's biggest banks, Austria's RBI, said Thursday it was "intensively" considering pulling out of some markets amid concerns the eurozone crisis is hitting the region. Herbert Stepic, chief executive of Raiffeisen Bank International which has almost 14 million customers in 18 countries across the region, said it was "quite possible that in future we will pull out of one or the other country." "We are at the start of a new era," Stepic said. "The chances that it will be a golden one are not that high." He added that the bank's forecast that bad loans would peak in the region in 2011 was no longer valid, although he said was still "happy" to be active there. "We have a sustainable business model, we are in the right markets and we can compensate for bad countries like Hungary with other countries." The comments came after RBI reported a 62-percent drop in third-quarter net profit, with losses in Hungary, which has approached the International Monetary Fund and the European Union about a possible bailout, hitting earnings. RBI's Austrian rival Erste Bank, with 17 million customers, is already expecting to be 700-800 million euros ($0.9-1.1 billion) in the red for 2011. Other lenders such as Italy's UniCredit have also grown wary of the region, with Germany's Commerzbank saying on November 4 it was restricting new lending to its home market and Poland. The exposure of Austrian banks to potential problems in central and eastern Europe has also created concerns that the country's triple-A credit rating could be at risk, although Vienna rejects any such fears. Austria's central bank and financial regulator called on banks this week to be more prudent about lending in the region and to waste no time strengthening their capital bases. Stepic said that in order to meet new European rules, RBI's parent company RZB would need to raise 2.5 billion euros in fresh capital and that the bank was already looking at ways to achieve this. RBI has sufficient capital to withstand "tsunami-like changes," he said. Stepic said that "from today's point of view," RBI would not abandon Hungary, whose rating is one notch above junk status, although he said that foreign banks operating there were being "greatly annoyed." The cash-strapped Hungarian government has imposed extra taxes on a number of sectors, including banks, and has forced lenders to swallow losses incurred by homeowners who took out mortgages denominated in Swiss francs. RBI said third-quarter consolidated net profit fell 62 percent to 130 million euros because of losses in its Hungarian subsidiary, which is expected to post a loss of 320 million euros this year. Nine-months net profit fell 10.9 percent to 760 million euros. Net provisioning for impairment losses shot up 91 percent from the second quarter to 377 million euros, with Hungary alone contributing 258 million euros, RBI said in a statement. The bank said it would need to carry out a "substantial" recapitalisation of its Hungarian business in the fourth quarter. "Against the backdrop of a clear deterioration in the economic environment and the continuing crisis involving the eurozone's peripheral states, we managed to post respectable results," Stepic stressed.
The Economy
|
. |
|
The content herein, unless otherwise known to be public domain, are Copyright 1995-2011 - Space Media Network. AFP and UPI Wire Stories are copyright Agence France-Presse and United Press International. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement |