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BA net profit down 10 per cent

Bosses at Bank Austria (BA) reported yesterday (Weds) that the bank had suffered a decline of 10 per cent in net profit year on year to 1.152 billion Euros in 2009.

They stressed though that the decline was relatively low despite the bank, a subsidiary of Italian UniCredit, having to increase its reserves for credit defaults from 1.012 billion Euros in 2008 to 2.267 billion Euros in 2009 since credit risk costs had tripled in Eastern Europe.

BA, which handles UniCredit�s business in that region, said it had been able to cover the increase in reserves for credit defaults from its operating earnings.

The bank added its earnings from business with customers had increased by 10 per cent last year and its earnings from trading had risen from minus 418 million Euros in 2008 to 326 million Euros in 2009.

Earnings per share were 5.45 Euros last year, slightly down from 5.66 Euros in the previous year, and there were 202 million shares outstanding at the end of last year.

BA added that, as was the case last year, it would not pay its parent bank a dividend this year. In 2007, BA paid UniCredit a dividend of 780 million Euros.

BA chief Willibald Cernko noted that the bank had had four poor quarters last year compared to only one in 2008.

He added that BA would not begin a cost-cutting programme in Austria but would continue those already underway in many Eastern European countries.

Austrian Times

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Bank underway cutting Euros business dividend slightly Europe reserves UniCredit defaults bank Willibald earnings Austria credit risen profit Cernko billion

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