Raiffeisen Bank Raises Guidance After 1Q Income Exceeded Forecasts
May 05 2023 - 2:25AM
Dow Jones News
By Mauro Orru
Raiffeisen Bank International raised its income and
capital-buffer ratio forecasts for the year after booking
higher-than-expected profit and core revenues for the first
quarter, buoyed by higher interest rates and strong growth in
customer loans.
The Austrian bank late Thursday posted a net profit of 657
million euros ($723.5 million) for the three months to the end of
March, up 48.7% on the year.
Net interest income--the difference between what lenders earn
from loans and pay for deposits, and a key profit driver for retail
banks--surged 40.5% to EUR1.39 billion, while net fee and
commission income climbed 41.3% to EUR966 million.
The lender said higher interest rates will likely persist for
some time as central banks seek to bring inflation to more
sustainable levels.
Provisions for credit losses stood at EUR301 million compared
with EUR319 million in last year's first quarter. Raiffeisen's
capital-buffer ratio, known as core equity Tier 1, or CET1, stood
at 16% at the end of March.
Analysts had forecast a net profit of EUR528 million on net
interest income of EUR1.31 billion and net fee and commission
income of EUR799 million, according to a company-compiled
consensus.
For the year, Raiffeisen now expects net interest income of
EUR5.3 billion to EUR5.4 billion, up from previous forecasts of
EUR4.5 billion to EUR4.7 billion. Net fee and commission income
should come in between EUR3.2 billion and EUR3.4 billion, up from
EUR2.4 billion to EUR2.5 billion previously. The bank's CET1 ratio
should be above 16%, ahead of previous guidance of more than
15%.
The bank said it would continue to look at potential deals to
dispose of its Russian operations, which Raiffeisen opted to
maintain even after the invasion of Ukraine, unlike several Western
peers.
Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94
(END) Dow Jones Newswires
May 05, 2023 02:10 ET (06:10 GMT)
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