Erste Bank reported its consolidated 9M 2003 IFRS results this morning. Net profit stood at EUR 255m and beat thus our estimate by 4.5%. Erste’s better bottom line was driven mostly by lower-than-expected provisioning for loans (6% below our estimate), thanks largely to the completion of restructuring and improved risk management in the Central European subsidiaries.
Operating result stood at EUR 1.02bn, which was slightly above our projections (EUR 1.00bn). Major operating revenue items (interest and fees incomes) were in line with our expectations, net trading profit was boosted by gains in derivatives and securities business, particularly in Austria.
Other operating result was negatively affected by an increase in amortization of goodwill, one-off write-down on IT projects, and provisions not related to lending. As a result, Erste’s other operating loss of EUR 129m significantly surpassed our estimate.
Overall, we consider Erste’s Q3 2003 results as positive.