Attica Bank “closed” the nine months of 2021 with capital adequacy ratios of CET1 12.1% and CAD 15.6% in pro forma level, as the bank states in the announcement of its results for the specific period.
The reduction in financing costs amounted to 19% on an annual basis, while the increase in net commission income by 52% on an annual basis was remarkable. Attica Bank also recorded an increase in deposits by 8.4% on an annual basis, while new financing and refinancing in the first nine months of 2021 reached 257 million euros.
12.4% of the up-to-date loan portfolio (before provisions) has been included in the regulations in force due to Covid-19, while the non-performing exposures index (NPEs) stood at 34.1% and the provision coverage ratio at 44.5 %.
In more detail:
▪ Net interest income is reduced by 7.5% compared to the corresponding comparative period of 2020. This is due to the reduction of interest income by 6.9% from loans and receivables as a result of large repayments during the nine months 2021 and especially within the third quarter, which decrease was only partially offset by the lower cost of financing the Bank’s operations by 19.1% compared to the comparative period of 2020. The decrease in financing costs is a consequence of the revaluation of deposit products, as well as the de-escalation of financing costs from liquidity-raising mechanisms. Significant Increase in Net Income from Commissions Base Cost
Α Fee and commission income in 2021 amounted to € 11.4 million, a resilient return, given the constraints on economic activity due to the Covid-19 pandemic for most of the period. The main contributors to this resilience were the production of new loans as well as the income from insurance products.
. At the same time, despite the slight decrease in staff, staff remuneration and expenses decreased by 3.0% on an annual basis.
▪ In addition, and following the announcement of the voluntary exit program from 13.5.2021, the first phase of this program has already been completed with the participation of 61 people, which corresponds to an annual savings of € 2.5 million. Based on the relevant approvals received by the competent administrative units of the Bank, with the completion of the departures on 31.12.2021, the Voluntary Exit Program will have included a total of 64 people with total salary cost savings on an annual basis of 2.6 million euros.
Attica Bank during the third quarter of 2021 continued the successful course in terms of supporting businesses and households. The Bank actively participated in all financial support programs guaranteed by government agencies for the benefit of its customers and at the same time increased its financing to support the real economy.
Προ Loans before provisions amounted to € 1.6 billion. New financing and refinancing for the period amounted to approximately € 257 million, of which € 238.4 million relates to business banking and € 18.1 million to retail banking. Strong liquidity and financing profile Increase in deposits + 8.4% per year with lower costs
2016 Since 2016, the Bank has paid to the BoG / ECB the cumulative amount of € 1.1 billion for the complete independence of the Bank from ELA, an amount which corresponds to approximately 1/3 of its total assets while at the same time it has increased its deposits from December 2016 by 52%.
Σύ Eurosystem funding in the first nine months of 2021 decreased to € 55 million from € 155 million in 2020 with a parallel cost reduction while in the current period, Eurosystem funding is zero.
▪ On 30.09.2021, the accounting balance of deposits amounted to € 2.87 billion, showing a significant increase of approximately € 224 million and 8.4% on an annual basis, while in the current period, the balance of customer deposits amounts to approximately € 3.1 billion, reflecting the positive outlook for the domestic environment.
▪ The increase in deposits reflects inflows mainly from individuals amounting to € 89 million and from companies amounting to € 75 million measured on an annual basis. Μι Savings and cash deposits amounted to € 1,133 million while time deposits to € 1,734 million ▪ At the same time, the average cost of deposits decreased further by 0.28 bp. compared to 2020. The significant improvement in liquidity has made the Group more focused on cost management in recent quarters, in an effort to strike a balance between attracting deposits and reducing interest expenses. The new cooperation started by the Bank with Raisin, a provider of deposit acceptance platform for citizens of the European Union, through which the inflows increased by approximately € 196 million during the nine months, also contributed significantly.
. As a result, the ratio of loans (before provisions) to the Group’s deposits amounted to 56.2%. Full Share Capital Increase Coverage of Capital Adequacy Restoration Actions Plan ▪ In December 2021, the full coverage of the share capital increase, amounting to € 240 million, was successfully completed.
▪ In relation to the other capital enhancement actions, the Bank has recruited consultants for the legal and technical part of the Omega, Astir 1 and 2 securitizations. An international house has already been hired for the Astir 1, 2 and Omega securities of the credit rating of high repayment securities (senior notes). Finally, the Bank is at an advanced stage in the process of transferring 95% of the intermediate and low repayment securities (mezzanine and junior notes, respectively), after receiving a relevant binding offer.
In its statement, which accompanies the results, the management of Attica Bank notes:
“On December 21, 2021, the Management of Attica Bank announced the full coverage of its share capital increase, amounting to 240 million euros in implementation of the shareholders’ agreement, as originally planned, thus achieving one of its main business objectives. The share capital increase is the starting point for the Bank’s growth course, which will contribute to the acceleration of the strengthening of its customer position and business activity. with a percentage of 62.93%, of TMEDE with a participation percentage of 14.7% and of the company RINOA LTD with a percentage of 9.87%, secured to the Bank a capital adequacy ratio CET1 which amounts to a pro forma level and based on the published data of 30.09. 2021, to around 12%, well above the current minimum levels, thus giving it the impetus to make a catalytic contribution to sustainable transformation but also in its development.
2022, with the maturation of the securitization evaluation and their inclusion in the “HERACLES 2” program, will be a milestone year for Attica Bank. In this way, the complete consolidation of the Balance Sheet is achieved and supervisory funds are released, which will be channeled for the development of the Bank’s operations and the significant increase of its loan portfolio. The strengthening of regulatory funds and the increase of deposits at high levels have led to a significant improvement in liquidity, which is a guarantee that Attica Bank will develop its operations and contribute significantly to the implementation of its business plan.
Attica Bank has focused on its planning, the modernization in key areas such as the improvement and upgrading of IT infrastructure, the digital transformation, the automation of processes, as well as the creation of digital stores that will lead to the gradual transformation of the traditional Network. at digital service points. The conclusion of strategic alliances with companies of recognized prestige in the context of optimizing the internal infrastructure of the Bank and the creation of a restructuring framework, will help the Bank to play an important role in the domestic banking market in the coming years.
In particular, during the closing period, a significant improvement was observed in almost all operating lines of the results, with net commission income showing a significant increase of 52% on an annual basis with the largest improvement being achieved through the increase of revenue / commission from loans , amounting to 74% while the cost of financing the Bank’s operations remains declining in the third quarter of 2021. For the period 01.01.2021 until 30.09.2021, new financing and refinancing amounted to approximately € 257 million and the loan ratio before provisions for deposits is at the level of 56%, after the completion of the Omega transaction. In addition, Attica Bank continued to improve its liquidity, which shows a significant increase mainly due to the increase in deposit balances, on an annual basis, by 8.4%.
“Attica Bank’s Management, shareholders and employees, looking to the future, are committed to implementing the Bank’s strategic planning responsibly and effectively, so that it can play a leading role in the development of the real economy with its own distinct and supportive role.”
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Source From: Capital
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