Komercni banka released details of its first-quarter IAS results on Monday afternoon (the main figures had been released in April, such as net income of CZK 1.3 bil.). The detailed figures did not contain anything that should cause stock price movement, in our view. The structure of the loan book did not change dramatically—the amount of non-performing loans slightly declined in absolute terms (from CZK 49.8 bil. at year-end 2000 to CZK 47.6 bil. at end of March) and as a percentage of the total loan portfolio (from 33.7% to 31.5%). While this is a positive development, KB still has a long way to go in restructuring its bad loans portfolio (but keep in mind the state guarantee covering bad loans means that the risk to KB’s earnings is very limited). As for the P&L, one surprising item was the 10% growth in staff costs, which is rather strong given that KB had 20% less workforce than one year ago.
(Ondřej Daťka)