DGAP-News: UniCredit Bank Austria AG: Bank Austria's results for the first nine months of 2012: Bank Austria posts net profit of EUR 1.1 billion for the first nine months
(firmenpresse) - DGAP-News: UniCredit Bank Austria AG / Key word(s): Quarter Results
UniCredit Bank Austria AG: Bank Austria's results for the first nine
months of 2012: Bank Austria posts net profit of EUR 1.1 billion for
the first nine months
14.11.2012 / 08:05
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Corporate News
Bank Austria's results for the first nine months of 2012
Date of entry: 14 November 2012
Bank Austria's results for the first nine months of 2012:
Bank Austria posts net profit of EUR 1.1 billion for the first nine months
- Net operating profit up by 11 per cent thanks to slight growth in
customer business, flat cost trend and further decline in provisioning
charge
- Compared to last year, lending volume rises by 3.9 per cent to EUR
136.3 billion, customer deposits up by 7.4 per cent to EUR 110.8
billion
- Net write-downs of loans in Austria and CEE down by a combined 13.4 per
cent to EUR 887 million
- Charge for bank levies totals EUR 92.5 million
- Profit before tax up by 37.9 per cent to EUR 1.4 billion
- Net profit increases to EUR 1.1 billion
- High loan / direct funding ratio: customer loans funded by customer
deposits and debt securities in issue to the extent of 102 per cent
Bank Austria's CEO Willibald Cernko: 'Despite the economic slowdown and
restrained credit demand, we achieved a sound performance in the first nine
months of the current year. This was due to slight growth in customer
business, strict cost discipline to offset the significant charges for bank
levies in Austria and Central and Eastern Europe, and a further decline in
net write-downs of loans. But the bank's performance should not obscure the
fact that with a return on equity of 8.5 per cent after tax, we still do
not meet the earnings expectations of investors. We will therefore
consistently pursue our strategy of optimising capital allocation by
minimising risks and making targeted investments where the potential for
growth and earnings is highest.'
Items in the income statement (Footnote 1)
Net interest - the most important component of income, accounting for 64
per cent of total operating income - for the first nine months of 2012 was
EUR 3,396 million, slightly higher than in the previous year (1-9 2011: EUR
3,365 million).
Net fees and commissions showed a weaker trend: at EUR 1,198 million, they
were down by 4 per cent from the first nine months of the previous year
(1-9 2011: EUR 1,242 million). The decline was due to continued uncertainty
among investors, reflected in lower turnover in securities business.
Net trading, hedging and fair value income (Footnote 2) for the first nine
months of 2012 was EUR 533 million, an increase of 52 per cent, which made
the strongest contribution to revenue growth compared with the same period
of the previous year (1-9 2011: EUR 351 million). The figure includes a
gain of EUR 126 million on the buyback of hybrid capital instruments
(perpetual bonds), which was effected in the first quarter of 2012 with a
view to adjusting the capital structure to regulatory changes.
Overall, operating income for the first nine months rose by 1.6 per cent to
EUR 5,301 million (1-9 2011: EUR 5,216 million).
Operating costs totalled EUR 2,940 million, a moderate increase of 2.7 per
cent over the comparative figure for the previous year (1-9 2011: EUR 2,863
million). In view of the charges arising from further increased bank levies
in Austria and several CEE countries, which totalled EUR 92.5 million, cost
growth was kept down by strict cost discipline and continued efficiency
enhancement in current operations.
The total charge for bank levies payable by the Bank Austria Group in the
first nine months of 2012 was EUR 92.5 million, of which EUR 72.5 million
relates to Austria, EUR 11.6 million to Hungary, EUR 7.1 million to
Slovakia, EUR 0.7 million to Romania and EUR 0.6 million to Slovenia.
Operating profit was EUR 2,361 million, slightly higher than for the same
period of the previous year, despite the charge for bank levies (1-9 2011:
EUR 2,353 million).
In the first nine months of 2012, net write-downs of loans and provisions
for guarantees and commitments were EUR 887 million, down by EUR 137
million or 13.4 per cent from the same period of the previous year (1-9
2011: EUR 1,024 million). The provisioning charge was reduced in Austrian
customer business and in Central and Eastern Europe. In Austria, net
write-downs of loans declined by 40.1 per cent to EUR 163 million (1-9
2011: EUR 273 million), in CEE by 4 per cent to EUR 724 million (1-9 2011:
EUR 752 million). Overall, the cost of risk (net write-downs of loans and
provisions for guarantees and commitments as a proportion of average loans
to customers) declined from 102 basis points (bp) for 2011 to 88 bp for the
first nine months of 2012.
Net operating profit - i.e. operating profit less net write-downs of loans
and provisions for guarantees and commitments, the key measure of operating
performance - improved significantly in the first nine months of 2012 by 11
per cent to EUR 1,475 million (1-9 2011: EUR 1,328 million).
Among the non-operating items, provisions for risks and charges were EUR 74
million, considerably lower than for the same period of the previous year
(1-9 2011: EUR 131 million).
Net income from investments for the first nine months of 2012 was EUR 27
million (1-9 2011: a net loss of EUR 147 million); the figure for the
previous year reflected write-downs on Greek government bonds.
Profit before tax for the first nine months was EUR 1,424 million, up by
37.9 per cent (1-9 2011: EUR 1,033 million).
Profit for the period for the first nine months of 2012 was EUR 1,161
million (1-9 2011: EUR 780 million), up by 48.9 per cent on the same period
of the previous year.
Net profit attributable to the owners of Bank Austria for the first nine
months of 2012 was EUR 1,101 million (1-9 2011: EUR 3 million). The
comparison with the previous year is not meaningful because
impairment losses on goodwill in 2011 totalled EUR 705 million,
substantially reducing the net profit of the previous year.
The following key financial data have been calculated on the basis of the
above-mentioned results:
- Return on equity before tax (without goodwill impairment) was 10.6 per
cent.
- Return on equity after tax (without goodwill impairment) was 8.5 per
cent.
- The cost/income ratio was 55.5 per cent.
- The risk/earnings ratio (provisioning charge as a percentage of net
interest income) was 25.5 per cent.
- The total capital ratio (based on all risks) was 11.73 per cent.
- The Tier 1 capital ratio (based on all risks) was 10.31 per cent.
- The Core Tier 1 capital ratio (based on all risks) was 10.10 per cent.
Results of the Divisions
Bank Austria reports its results in four Divisions: Family&SME Banking
(F&SME), Private Banking, Corporate&Investment Banking (CIB) and the CEE
Banking Division. The bank also shows results for the Corporate Center.
Profit before tax generated by the Family&SME Banking Division in the
first nine months of 2012 was EUR 78 million, more than double the previous
year's figure (1-9 2011: EUR 30 million). The improvement resulted from the
sound development of customer business and especially from the significant
decline in the provisioning charge, which was down by 52.7 per cent to EUR
74 million (1-9 2011: EUR 156 million). The cost/income ratio was 81.7 per
cent (1-9 2011: 79.0 per cent).
The Private Banking Division's profit before tax for the first nine months
of 2012 was EUR 31 million, matching the previous year's level (1-9 2011:
EUR 31 million). Compared to the same period of the previous year, net fees
and commissions remained stable, while net interest increased by about 6
percent. The cost/income ratio was 71.7 per cent (1-9 2011: 70.8 per cent).
Profit before tax generated by the Corporate&Investment Banking (CIB)
Division in the first nine months of 2012 was EUR 369 million, up by 14.4
per cent on the same period of the previous year (1-9 2011: EUR 323
million). The significant increase resulted from slight growth of operating
profit and a decline of 20.8 per cent in net write-downs of loans and
provisions for guarantees and commitments. The cost/income ratio was 36.2
per cent (1-9 2011: 37.9 per cent).
The CEE Division performed strongly in the first nine months of 2012.
Profit before tax rose to EUR 1,287 million, an increase of 13.8 per cent
over the same period of the previous year (1-9 2011: EUR 1,131 million).
This was driven by a strong operating performance in customer business and
by a further decline in net write-downs of loans and provisions for
guarantees and commitments despite the ongoing business expansion in
selected markets. The cost/income ratio was 46.4 per cent, more or less
matching the previous year's level (1-9 2011: 46.2 per cent).
Within UniCredit, Bank Austria is the sub-holding company for operations in
the region of Central and Eastern Europe. Its banking network comprises
about 2,700 branches and about 50,500 employees (Footnote 3) in 18
countries. The Group continues to see itself as a long-term investor in the
CEE region and is going to maintain its leading market position in the
region through selective investments in the strategic CEE markets of the
Czech Republic, Turkey and Russia.
The past couple of quarters unmistakably reminded CEE countries of the fact
that the post-crisis growth path is neither smooth nor guaranteed. Although
the region has proven surprisingly resilient towards a contagion from the
Western European sovereign debt crisis, concern about uncertainty over the
pace of global growth remains. In their latest GDP forecast for the CEE
region UniCredit economists assume economic growth to amount to plus 2.5
per cent in 2012 and plus 3.1 per cent in 2013. Regional labour
productivity, costs and competitiveness give reason for optimism.
'Sound customer business, strict cost discipline and a lower provisioning
charge have enabled us to achieve a strong increase in profit before tax in
CEE business. At the same time the local funding capabilities of many CEE
subsidiaries have improved through strong growth in deposits, which clearly
exceeded growth in loans. Despite recently blurring economic indications
for the CEE region, we stick to our strategy of focused investments in
selected growth markets', says Gianni Franco Papa, Bank Austria's Deputy
CEO and Head of the CEE Division.
Financial position
Bank Austria's total assets as at 30 September 2012 were 205.3 billion, up
by 6.1 billion or 3.1 per cent from the end of the previous year (31
December 2011: EUR 199.2 billion).
On the assets side, loans and receivables with customers amounted to EUR
136.3 billion as at the end of September 2012, up by 3.9 per cent on a year
earlier (30 September 2011: EUR 131.1 billion). Loans and receivables with
banks declined significantly, to EUR 25.7 billion (30 September 2011: EUR
27.6 billion).
On the liabilities side, deposits from customers increased by 7.4 per cent
to EUR 110.8 billion (30 September 2011: EUR 103.2 billion) while debt
securities in issue declined by 7.7 per cent to EUR 28.3 billion (30
September 2011: EUR 30.6 billion). Primary funds - i.e. the sum total of
deposits from customers and debt securities in issue - totalled EUR 139.1
billion, representing 67.7 per cent of total liabilities andequity. This
means that customer loans were covered by primary funds to the extent of
102 per cent.
As at 30 September 2012, IFRS equity was EUR 19.4 billion, up by EUR 1.8
billion or 10 per cent on year-end 2011 (31 December 2011: EUR 17.7
billion). At this level, IFRS equity was 12.4 per cent higher than at the
end of September 2011.
The Tier 1 capital ratio (which by definition does not include net profit
for a period of less than one year) was 10.31 per cent at the end of
September 2012, slightly lower than at the end of the previous year (31
December 2011: 10.88 per cent). The decline reflects the buyback of hybrid
instruments and the increase in risk-weighted assets. The Core Tier 1
capital ratio (Tier 1 capital ratio without hybrid capital) based on all
risks was 10.10 per cent (31 December 2011: 10.55 per cent), comfortably
above the regulatory requirement.
Staff numbers in the Bank Austria Group including the employees of
UniCredit's subsidiaries (Footnote 4) in Austria totalled 60,750 (full-time
equivalents - FTEs) as at 30 September 2012 (30 September 2011: 62,390
FTEs). Of this total, 10,216 (FTEs) were employed in Austria and 50,534 in
CEE countries.
Footnote 1: To ensure comparability, the comparative figures have been
adjusted. Bank Austria Global Information Services GmbH was sold to
UniCredit Global Information Services, Milan, as at 30 June 2011.
Footnote 2: Following the sale of CAIB, the item 'Net trading, hedging and
fair value income' also includes the participation in profits of the
Markets subdivision of UniCredit's CIB Division.
Footnote 3: Figures without Poland
Footnote 4: Administration Services / UniCredit Business Partner, BAGIS,
WAVE (which are now integrated in UBIS); UniCredit Leasing, Pioneer
Investments Austria and UniCredit CAIB were transferred on an intra-group
basis.
in Euro mn 9M12 9M11 Change over Change overn.m. = not meaningful
previous previous
year year
in Euro mn in %
Net interest 3,396 3,365 30 0.9%
Dividend income and other
income
from equity investments 80 152 -71 -47.0%
Net fees and commissions 1,198 1,242 -44 -3.6%
Net trading, hedging and
fair value income 533 351 182 51.9%
Net other expenses/income 94 105 -11 -10.6%
Operating Income 5,301 5,216 85 1.6%
Payroll costs -1,505 -1,492 -13 0.9%
Other administrative expenses -1,233 -1,172 -61 5.2%
Recovery of expenses 1 1 0 -32.5%
Amortisation, depreciation and
impairment losses on
intangible and
tangible assets -203 -201 -2 1.0%
Operating costs -2,940 -2,863 -77 2.7%
Operating profit 2,361 2,353 9 0.4%
Net write-downs of loans and
provisions
for guarantees and commitments -887 -1,024 137 -13.4%
NET OPERATING PROFIT 1,475 1,328 146 11.0%
Provisions for risks and
charges -74 -131 57 -43.6%
Integration/restructuring
costs-3 -17 14 -80.6%
Net income from investments 27 -147 174 n.a.
PROFIT BEFORE TAX 1,424 1,033 391 37.9%
Income tax for the period -263 -253 -10 3.9%
Profit for the period 1,161 780 381 48.9%
Non-controlling interests -39 -41 2 -4.5%
NET PROFIT ATTRIBUTABLE TO THE
OWNERS OF BANK AUSTRIA BEFORE
PPA 1,122 739 383 51.8%
Purchase Price Allocation
effect -12 -31 20 -62.8%
Goodwill impairment -10 -705 696 -98.6%
NET PROFIT ATTRIBUTABLE TO THE
OWNERS OF BANK AUSTRIA 1,101 3 1,098 n.m.
Notes:
1- Bank Austria's income statement as presented in this table is a
reclassified format corresponding to the format used for segment
reporting.
2- 2011 recast: The comparative figures for 2011 have been recast to
reflect the consolidation perimeter, business structure and
methodology.
3- Purchase Price Allocation (PPA) effects for Kazakhstan, Ukraine, Russia
and Aton.
in Euro bn 30.09.2012 31.12.2011Issuer:
Total Assets 205.3 199.2
Equity 19.4 17.7
UniCredit Bank Austria AG
Schottengasse 6-8, 1010 Vienna, Austria
e-mail: investor.relations(at)unicreditgroup.at
Internet: http://ir.bankaustria.at
Largest bonds by volume issued:
ISIN Stock exchanges:
XS0343689377 Luxemburg
XS0372532514 Luxemburg
XS0379307258 Luxemburg
AT000B048988 Vienna
AT000B049010 Vienna
Further stock exchanges where bonds are admitted to listing:
Frankfurt, Stuttgart, Paris, Zurich, Munich
Contact:
Günther Stromenger
Corporate Relations - Bank Austria
phone: +43 (0) 50505 - 57232
e-mail: guenther.stromenger(at)unicreditgroup.at
End of Corporate News
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Language: English
Company: UniCredit Bank Austria AG
Schottengasse 6 - 8
1010 Wien
Austria
Phone: 0043 (0) 50505 - 57232
Fax: 0043 (0) 50505 - 8957232
E-mail: investor.relations(at)unicreditgroup.at
Internet: www.bankaustria.at
ISIN: AT0000995006
WKN: 99500
Listed: Foreign Exchange(s) Luxembourg, Wien (Amtlicher Handel /
Official Market)
End of News DGAP News-Service
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