Piraeus Bank raised its NPLs coverage rate to 82 pct from 70 pct in September 2017, the best in the Greek banking market alongside National Bank of Greece, bank officials said on Tuesday.
The officials noted that the NPEs coverage rate was 52 pct, at the same level as Alpha Bank, up from 45 pct in September 2017. The bank has significantly raised its coverage of NPEs and NPLs through increased provisions taken in 2017 and the impact from the first implementation of IFRS 9.
The officials said that this combination facilitated a reduction of balance risks and the de-escalation of provision cost in the future. Based on a market update released by the bank, the IFRS 9 impact is estimated at 1.6 billion euros, less than market expectations.
Loan provisions for 2017 are estimated at 2.0 billion euros (1.2 billion in the fourth quarter of 2017) from 1.0 billion in 2016. The bank said that NPEs fell to 31.3 billion euros at the end of December 2017, from a goal of 31.5 billion, while NPLs fell to 19.8 billion euros, from a goal of 20.1 billion.
The bank is implementing a series of actions aimed to achieve its goals for NPEs through restructuring, collection, liquidations and selling of loans.
The group’s CET-1 capital adequacy rate was around 15.5 pct at the end of December (pro-forma).
The bank said consolidated net results were at a break-even level in 2017. Parent results are expected to be slightly positive in 2017.