12° Nicosia,
04 October, 2022

Hellenic mulls over selling delinquent loans

Cyprus' second largest lender posts €35m net profit in first half of 2018

Newsroom / CNA

Hellenic Bank posted a €35 million net profit for the first half of 2018, with the bank’s CEO Ioannis Matsis stating that the bank is ready to launch a tender for the sale of a portfolio of non-performing exposures within the next six months.

“The bank will be ready in the next six months to launch a tender for the sale of non-performing exposures,” Matsis said in a press conference for the presentation of the financial results for the six months ended in June 30 2018 without elaborating on a target range.

Describing the results of Bank of Cyprus’ NPEs sale, which attracted interest from many investment funds, as very good, Matsis said he is confident that investment funds will show similar interest for the tender to be launched by Hellenic Bank.

In its financial results, the bank said it achieved an organic NPEs reduction for eleven consecutive quarters, with NPEs declining in the second quarter to €2.11 billion compared with €2.16 billion in end-2017. The NPE to total loans ratio amounted to 51.6%.

Following Bank of Cyprus’ NPEs 'very good' sale results, Matsis is confident investment funds will show similar interest for a tender to be launched by Hellenic Bank

“The decrease was mainly driven by the curing of restructured loans, collections, debt to asset swaps and write-offs,” the bank said.

NPE coverage ratio amounted to 62% from 61% in end-2017.

In June 2018 the Bank had completed its first sale of a non-performing loan portfolio amounting to €144 million of predominantly non-retail unsecured exposures to B2Kapital Cyprus Ltd, a wholly owned subsidiary of B2Holding ASA, a Norwegian corporation listed on the Oslo Stock Exchange.

The Bank’s Common Equity Tier 1 Capital ratio amounted to 13.7% and its Capital Adequacy amounted to 17.4%, the bank said.

The bank also said it approved new loans amounting to €328 million in the first half of 2018 representing an increase of 77% compared with the respective period of last year.

Net loans to deposits in the first half of 2018 stood at 47%, with deposits amounting to €5.9 billion marginally up compared with €5.8 billion in end-2017, while gross loans increased by 1% to €4.08 billion in the end of June 2018.

Hellenic absorbs credit unions

In July the Bank announced it agreed to acquire the performing operations of the Cyprus Cooperative Bank, a move that would render Hellenic Bank as the island’s second largest lender.

The agreement provides for the transfer of a balance sheet amounting to €10.3 billion, including €9.7 billion in deposits, net loans of €4.6 billion and government bonds of €4.1 billion.

This transaction is expected to accelerate the bank’s strategy to strengthen its operations throughout Cyprus with a broader and diversified customer base leading to a more diversified loan portfolio, Matsis said.

“After the acquisition the bank is the Bank will be become the second largest bank and the leading retail bank on the island,” he added.

Cyprus  |  Hellenic  |  bank  |  cooperative  |  credit unions  |  NPL  |  bad loans  |  investment  |  hedge fund

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