Erste Group’s profit rises on higher net interest income

by Ed Frankley

Erste Group Bank AG on Monday said its first half profit rose as it took advantage of an increase in net interest income based on solid loan growth.

The Austrian lender’s net profit rose to 1.14 billion euros ($1.17 billion) in the six months to the end of June, up from EUR918 in the same period last year.

The bank, which focuses on Central and Eastern Europe, said net interest income rose to EUR2.84 billion from EUR2.45 billion in 1H 2021, helped by interest rate hikes in the Czech Republic, Hungary and Romania.

Erste said loan volume growth increased 6.3% to EUR191.5 million, while its operating result rose 10% to EUR1.86 billion.

Erste said it now expects net loan growth in the high single-digit percentage range for the full year. In its first quarter earnings, it said it expects growth in the mid-single digits.

It maintained its full-year guidance for double-digit returns on tangible equities, though its outlook was based on the assumption that its core markets could import substantial amounts of gas from Russia this year.

The Vienna-based company said it planned to pay a dividend of 1.90 euros per share in 2022.

Write to Ed Frankl at [email protected]

(END) Dow Jones Newswires

Aug 01, 2022 02:13 ET (06:13 GMT)

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