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Erste Group wants to reduce costs despite rising profits
VIENNA. The Bank Group was able to increase the first half result by 774 million euros.
Andreas Treichl Image: Reuters
In all countries is active, Erste Group made profits in the first half. In terms of operating results, after four years, there has been a turnaround, it has slightly recovered. Loans and deposits are increasing. The prospects for next year are positive. Managing Director Andreas Treichl, however, wants to continue cutting costs.
Work is continuing to cut costs, said Treichl at a press conference yesterday in Vienna. Although operating expenses were slightly higher than in the first half of 2017 due to higher staff costs collectively agreed in the first half of 2018 at EUR 2,076 billion, development slowed in the second quarter, as expenses decreased by report in the first quarter. [19659007] Long-term lazy loans down
At a rate of 3.6 percent, the proportion of bad loans on the loan portfolio is at a 10-year low. At the end of the year, the rate should continue to fall. The credit risk costs lead Willibald Cernko's risk management in his bank to no longer sweat. Here, the resolutions currently exceed the new provisions to be formed. However, Cernko is worried about signs of overheating of the Austrian credit market, ie loan maturities for some competitors and "marginal" debt financing for home loans.
The bank plans to invest a lot of money in its digital services. "More and more attackers are entering our markets, almost all at extremely low cost, so we need good returns," said Treichl. More revenue, savings and efficiency gains should bring the cost / income ratio, currently at 61.5%, to 55% and below. According to Treichl, this should not be necessary for more than three years.
In the first half, Erste Group made a profit of 774 million euros, or 24% more than in the first half of the previous year. In the second quarter, the bank realized 438.2 million euros (previous year: 362.5 million euros). In the middle of the year, Erste Group employed nearly 47,600 people
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