Bank of Cyprus Holdings recorded profit after tax of €43 million, and earnings per share of 10 cents for the quarter ended 31 March 2018, according to Group financial results released Tuesday.
The stock of Non Performing Exposures (NPEs) was reduced by €454 mn to €8.3 bn. That was the twelfth consecutive quarter of material NPE reduction. The overall stock of NPEs was reduced by 44% since December 2014. Coverage levels against non performing exposures increased to 51% (post IFRS 9 First Time Adoption), well-above the EU average of 44%. NPE ratio stood at 45%.
In the first quarter, the Common Equity Tier 1 capital (CET1) ratio (transitional basis) stood at 12.0% at 31 March 2018, compared to 12.7% at 31 December 2017. The CET1 ratio on a fully-loaded basis (IFRS 9 transitional) totalled 11.7% at 31 March 2018, compared to 12.2% at 31 December 2017. The Total Capital ratio stood at 13.5%, compared to 14.2% at 31 December 2017, mainly affected by the aforementioned definition alignment changes.
Group customer deposits increased by 1% to €17,996 mn at 31 March 2018, compared to €17,850 mn at 31 December 2017, with customer deposits in Cyprus increasing by €123 mn (1%). Cyprus deposits stood at €16,105 mn at 31 March 2018, accounting for 89% of Group customer deposits.
The Bank’s deposit market share in Cyprus reached 34.1% at 31 March 2018 (compared to 33.3% at 31 January 2018). Customer deposits accounted for 77% of total assets at 31 March 2018. The Loan to Deposit ratio stood at 80% at 31 March 2018, down from 82% at 31 December 2017, compared to a high of 151% at 31 March 2014.
Group gross loans totalled €18,586 mn at 31 March 2018, compared to €18,755 mn at 31 December 2017. Gross loans in Cyprus totalled €16,478 mn at 31 March 2018 and accounted for 89% of Group gross loans. The Bank is the single largest credit provider in Cyprus with a market share of 37.4% at 31 March 2018, compared to an adjusted market share of 37.5% as at 31 January 2018. New loan originations for the Group reached €717 mn for 1Q2018 exceeding new lending in 1Q2017.
Total income for 1Q2018 amounted to €231 mn, compared to €214 mn for 4Q2017, up by 8% qoq. Operating profit for 1Q2018 was €125 mn, compared to €105 mn for 4Q2017, up by 18% qoq, reflecting the increase in total income.
Total expenses for 1Q2018 were €106 mn (compared to €109 mn for 4Q2017 and €107 mn for 1Q2017), 55% of which related to staff costs (€58 mn).
The cost to income ratio for 1Q2018 was 46%, compared to 51% for 4Q2017, principally reflecting the 8% qoq increase in total income.
Bank’s CEO John Patrick Hourican said that the results reflect continuing delivery against the Bank’s core objective of balance sheet repair.
“We are pleased with the good momentum we are seeing in the business and, as our guidance continues to exclude the impact of any accelerated asset disposals, our expectations for the full year are unchanged,” he said. The Bank maintained the earning per share guidance of 40 cents. Hourican also expressed confidence that the Group could make further progress in reducing the NPE stock during the coming quarters and the full year target of ~€2 bn organic NPE reduction.