Tuesday, July 26, 2016

Angola helps BPI profit to grow 39% – Observer

The Bank BPI recorded net income of EUR 106 million during the first half of 2016, which represents an increase in profits of 39% compared to the first six months of the previous year. The figures released on Tuesday by the financial institution indicate that this result was due to a contribution of the bank’s activity in the domestic market of 24.5 million euros, up 271%, while profits from operations foreign generated 81.4 million euros , mainly originating in the Angolan market.

Banco de Fomento Angola , where BPI has a majority stake of 50, 1%, contributed 79.1 million euros to net income obtained by the bank led by Fernando Ulrich, with an increase of more than 18%. For every one hundred euros in net income realized by the bank in the first six months of 2016, 75 euros arrived from Angola . The BCI, which operates in Mozambique and is owned 30% by BPI, “delivered” 3.3 million euros, down 95% compared to the first half of 2015.

net interest income of the BPI , the difference between interest paid and interest received, stood at 360 million euros , an increase of 8.8% over the period which took place between January and June 2015. As for operating income, which includes also charged commissions and other income, totaled more than EUR 602 million, equivalent to an increase of 2.6%.

provisions made by BPI to cover impairment losses on loans granted fell by 46% with a value of 47.3 million euros. In credit, the bank shows a contraction. The portfolio amounted to 24 billion euros at the end of the first half of 2016, indicating a decrease of 1.4%. On June 30, 2016, refers to information disclosed by the institution, “ customer performing loans ratio over 90 days stood at 3.6% in the consolidated accounts “, a lower percentage than 3.8% which prevailed a year ago, but it reveals a stabilization in the level that prevailed in the end of 2015.

also the total customer funds, heading where the deposits taken are included, They registered a decline. They stood at 34.1 billion euros, a decline of 3.3%. With this development, the relationship between loans granted and deposits stood at 88% in consolidated terms , an indicator that rises to 108% when considering only domestic activity.

the bankruptcy process in which Hi is involved was not good news for the BIS accounts. The bank took impairment in PT International Finance bonds, part of the Brazilian telecommunications operator group in the amount of EUR 20.2 million before taxes. According to Lusa, Fernando Ulrich, chairman of the BPI, said on Tuesday that the balance sheet position of these EN obligations / Hi is fixed at 23 million euros, by the entity applied a hair cut 85% .

the executive chairman of the bank said that BPI’s management team has “hope” that you can recover a higher value with these Group debt hi due to the bankruptcy process of the Brazilian operator. “The titles we have are due in March next year,” specified the manager during the presentation press conference of half-yearly accounts of BPI held in Lisbon. After taxes, the impairment charges recorded these obligations amount to 14.2 million euros.

On Friday, the shareholders of Hi approved the bankruptcy process the company’s request on 20 June in following the fact that the telecommunications giant has failed to negotiate the debt 65.4 billion reais [€ 18 billion]. The approval was marked by several discussions, most of them related to the opposition of certain shareholders with respect to the participation of Bratel BV in the vote.

Bratel BV is controlled by the Portuguese company Pharol, which holds a indirectly about 22% of the total capital of the Brazilian operator, constituting 27.49% of the common shares. In the end, the meeting board ultimately decided by the participation of Bratel BV in the voting, which was favorable to the judicial recovery.

On the other hand, BPI managed to get significant gains in financial operations, the sale of shares made during the merger of Visa Europe with Visa Inc. to yield total 31.5 million euros. Of these, 22.9 million are from the sale of securities of Visa Europe which BPI directly owned “several years” as stated Fernando Ulrich, while the remaining 8.6 million were equity accounted earnings coming from participation that the bank holds in Unicre.

the BPI will continue in 2016, initiatives that aim to reduce the branch network, together with the decrease in the number of workers. The Business Journal reports that the cuts in personnel will cover 321 people, which will be achieved mainly through early retirement to reach 252 employees. To support this decision, the Bank recorded a provision in an amount exceeding 46 million euros.

“Most have accepted the agreements proposed by the bank,” said Fernando Ulrich, quoted by the same newspaper, and process will lead to the BPI contract the total number of employees to 5,578 employees by the end of 2016. in the first half, the bank closed 27 branches and now has a network of 558 agencies.

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