National Bank of Greece posts higher profit in third quarter, loan loss provisions decline

A man makes a transaction at an ATM outside a branch of the National Bank in Athens, March 23, 2015. REUTERS / Alkis Konstantinidis

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ATHENS, Nov.26 (Reuters) – The National Bank (NBG) (NBGr.AT), one of Greece’s four largest lenders, on Friday reported higher net profit from July to September compared to the second quarter, in a context of lower provisions for impaired loans and higher net interest income.

NBG, 40 percent owned by the country’s bank rescue fund HFSF, said its net profit reached 192 million euros from net profit of 18 million euros in the second quarter.

Provisions for bad debts fell 10% to 63 million euros in the third quarter with its so-called non-performing exposures (NPEs) down to 11.8% of its loan portfolio against 12.7% at the end of June.

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“NBG’s performance in the third quarter reflects both the impact of the strong economic recovery as well as the multi-year transformation effort,” CEO Paul Mylonas said in a statement.

Banks in Greece have struggled to shrink an estimated € 30 billion ($ 34 billion) stack of bad debt, a legacy of a financial crisis that lasted ten years and cut the market by a quarter of economy of the country.

The group’s net interest income increased by 3% on a quarterly basis to 306 million euros with a net interest margin of 2.15%.

“The accretive performance of NPE capital, both organic and inorganic, combined with strong profitability drove capital ratios up to 17.8% and c19% for CET1,” said Mylonas.

($ 1 = € 0.8835)

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Reporting by Lefteris Papadimas; Editing by Elaine Hardcastle

Our standards: Thomson Reuters Trust Principles.

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