All figures are based on International Financial Reporting Standards (IFRS).
Raiffeisen Bank International AG (RBI) posted a consolidated profit of ˆ 157 million for the first quarter of 2013, which represents a decrease of 71 per cent compared to the first quarter of the preceding year (Q1 2012: ˆ 541 million). However, last year’s period had been impacted by one-off effects such as gains achieved from the sale of bonds and the repurchase of hybrid core capital totaling ˆ 272 million.
Furthermore, the quarterly result was negatively distorted by ˆ 82 million due to valuation effects on long-term structured notes as well as senior and subordinated liabilities. This valuation result has no effect on regulatory capital or capital ratios. As the credit spreads of RBI decreased significantly recently, the fair value of these liabilities also increased significantly.
«We started the year on good terms. Despite the low interest rate environment and the weak economic cycle, we increased our operating income compared to the first quarter of 2012. We expect the economic cycle to pick up in the second half of the year and therefore we are optimistic to achieve a pleasing result», said RBI-CEO Herbert Stepic.
Profit before tax decreased by 63.4 per cent to ˆ 251 million (Q1 2012: ˆ 685 million), while profit after tax declined by 69.7 per cent to ˆ 174 million (Q1 2012: ˆ 574 million). Earnings per share declined from ˆ 2.52 in the first quarter of 2012 by ˆ 1.97 to ˆ 0.55.
Return on equity before tax declined by 15.9 percentage points to 9.2 per cent.
Operating income — excluding goodwill impairments totaling ˆ 3 million in the first quarter of 2013 — increased slightly year-on-year by 1 per cent or ˆ 6 million to ˆ 1,302 million.
Net provisioning for impairment losses rose ˆ 67 million to ˆ 220 million compared to the same period last year, mainly impacted by portfolio-based loan loss provisions. In the previous year, the results included a net release of ˆ 21 million (mainly at Group head office and in Russia), whereas in the first quarter of 2013, net allocations of ˆ 27 million were made. Net allocations to individual loan loss provisions were also up ˆ 18 million to ˆ 194 million, relating primarily to several large customers of Group head office and in China.
The portfolio of non-performing loans (NPL) to non-banks increased ˆ 47 million in the first quarter (thereof currency effects: minus ˆ 8 million). On a currency-adjusted basis, increases were posted in Southeastern Europe (up ˆ 85 million) and at Group head office (up ˆ 20 million), while Central Europe (down ˆ 33 million) and Russia (down ˆ 14 million) posted decreases. The NPL ratio rose 0.1 percentage points to 9.9 per cent quarter-on-quarter, NPL coverage ratio increased 0.5 percentage points to 67.5 per cent.
Despite positive effects from ongoing cost reduction programs, general administrative expenses climbed 5 per cent or ˆ 35 million year-on-year to ˆ 788 million. This increase was primarily attributable to Polbank consolidation in May 2012 and its integration. The cost/income ratio thus climbed 2.4 percentage points to 60.5 per cent.
Staff expenses, at 52 per cent the largest component in general administrative expenses, increased by 6 per cent or ˆ 24 million to ˆ 406 million. This increase mainly stemmed from the Polbank consolidation and salary adjustments in Russia. In contrast, cost reductions in Ukraine and Serbia as well as headcount reductions in Hungary had a positive effect.
The average number of employees grew by 525 to 59,552, mostly due to Polbank consolidation.
As of 31 March 2013, RBI had 59,231 employees, 1 per cent less than at the end of 2012.
As of 31 March 2013, RBI’s total assets amounted to ˆ 131.9 billion, which represents a decline of 3 per cent or ˆ 4.2 billion since the end of 2012 and a year-on-year decrease of 11 per cent or ˆ 16.9 billion. This drop in total assets is primarily attributable to the ongoing reduction of excess liquidity.
Loans and advances to customers after deduction of loan loss provisions fell ˆ 0.5 billion to ˆ 77.3 billion. Representing 59 per cent of total assets (plus 2 percentage points), they still dominate the asset side. Loans from repurchase agreements, at ˆ 0.8 billion, were responsible for the decline. In contrast, retail business in Russia increased ˆ 0.3 billion.
Deposits from customers were ˆ 0.6 billion higher at ˆ 66.9 billion. While short-term deposits from corporate customers (in Russia and at Group head office) grew ˆ 0.5 billion, those from retail customers declined ˆ 0.2 billion. The largest declines occurred in the Czech Republic (down ˆ 0.4 billion) and in Hungary (down ˆ 0.2 billion) because of currency effects.
Because of the diverging development of deposits and loans, the loan/deposit ratio decreased slightly to 121 per cent.
Raiffeisen Bank International AG (RBI) regards both Austria, where it is a leading corporate and investment bank, and Central and Eastern Europe (CEE) as its home market. In CEE, RBI operates an extensive network of subsidiary banks, leasing companies and a range of other specialised financial service providers in 17 markets.
RBI is the only Austrian bank with a presence in both the world’s financial centres and in Asia, the group’s further geographical area of focus.
In total, around 60,000 employees service about 14.2 million customers through in more than 3,000 business outlets, the great majority of which are located in CEE.
RBI is a fully-consolidated subsidiary of Raiffeisen Zentralbank Osterreich AG (RZB). RZB indirectly owns around 78.5 per cent of the common stock, the remainder is in free float. RBI’s shares are listed on the Vienna Stock Exchange. RZB is the central institution of the Austrian Raiffeisen Banking Group, the country’s largest banking group, and serves as the head office of the entire RZB Group, including RBI.