The key development at the analysts meeting on 4Q05 results was a statement from the CEO of BRE Bank, Slawomir Lachowski, indicating that the bank is not yet certain that it will pay a dividend (in 2007) from its 2006 net earnings - if this occurs, it will be the 5th year in a row. The bank reiterated, at the time of the results release, that no dividend would be paid from its 2005 net profit but this was already expected. BRE Bank is rebuilding its capital ratio slowly and has announced the reacquisition of BRE Bank Hipoteczny at the beginning of this year.
Unfortunately, on the results of BRE Bank Hipoteczny for 2005, the bank was unable to provide any detail in terms of the income statement for last year. However, the CEO did indicate that the company is expected to at least match its pre-tax earnings of PLN 26.8m again in 2006.
Finally, on the bank's pre-tax profit target of PLN 380m, it would appear to translate roughly into a post-tax profit of some PLN 287.8m (taking into consideration a 19% effective tax rate and the share of minority interests at some PLN 20m). This would compare to the current consensus estimate for 2006 of PLN 294m and our estimate of PLN 274.7m, under review following the results.