Manos Chatzidakis: Market Comment - In the Spotlight

Manos Chatzidakis	9:51 π.μ. (Πριν από 9 λεπτά)

           Market Comment

A late push led by Coca-Cola HBC (+2.87%) contained the significant losses incurred by most blue chips during Monday’s session as investors sought to cash in on last week’s gains. Correction was sharp in the banking sector (-14%) where last week’s gains triggered more intense liquidation trades. We expect a nervous session as leveraged positions in financial sector may keep volatility range high.

          In the Spotlight

Bank of Piraeus (Results 3M 2013): Bank of Piraeus reported net profits of 3.62 billion euros compared with 46 million euros in the same period a year earlier. The figure included 3.41-billion-euro goodwill write-back from the Cypriot takeover and a deferred tax asset of 540 million euros. Excluding the one-off gain, Piraeus lost 336 million euros before taxes. Piraeus bought the Greek branches of Cypriot lenders Bank of Cyprus, Cyprus Popular and Hellenic Bank for 524 million euros to shield the Greek banking system from the island’s debt crisis. The bank’s loan-loss provisions rose to 506 million euros in the first quarter from 296 million a year earlier, with its ratio of non-performing loans (NPLs) rising to 31 percent of its loan book from 23.3 percent in December. In specifics:

 

¡         Pre-provision loans totaled 71.9 billion euros, of which corporate loans were 66 pct, housing 23 pct and consumer loans 10 pct.

¡         Deposits totaled 53.3 billion euros, of which saving deposits accounted for 38 pct (up from 30 pct in March 2012).

¡         The loan/deposits rate rose to 114 pct in March from 158 pct a year earlier. The delayed loans rate rose to 31 pct, while the accumulated provision/loan rate was 16 pct.

¡         Branch network totaled 1,630 units at the end of March, of which 1,186 in Greece and the 444 distributed in nine countries abroad, while its workforce was 23,574 (17,408 in Greece and 6,167 abroad).

¡         Net interest income amounting 350 million in the first quarter 2013. Net interest income was negatively affected by 44 million due to the use of the yearly mechanism that was the sole source of Eurosystem financing up to mid-January 2013

¡         Net fees and commission income reached 55 million, 90% of which was   originated from commercial banking activities.

¡         Including Millennium Bank, loans after provisions totalled 64.9 billion euros, deposits were 56.3 billion euros, the loan/deposit rate was 115 pct and the provisions to loans rate was 15 pct. Its branch network totaled 1,750 units with a workforce of 24,756, while the group enjoyed a market share of 29.6 pct in loans and 28.9 pct in deposits.

¡         ELA declined to 19bn from 32bn in 31.12.

¡         According to management tangible book will reach post capital raise to €8.8bn.

NBG: National Bank has announced a reverse stock split in the context of its recapitalization, whereby 10 old shares will be traded for a new one at a price of 4.29 euros each, from 0.429 euros before the reverse split. The governing board of National decided on Monday that with the reverse split the existing number of 1,226,601,200 shares will be reduced to 122,660,120 shares. The board also decided to set a price of 4.29 euros for every new share after the reverse split and recapitalization, in the context of which 2,274,125,874 new shares will be issued. The bank’s shareholders will be given the option to acquire 2.2 new shares for each share they own.

Greece/Budget Execution: The Finance Ministry confirmed on Monday that April was the first month this year that the targets for both direct and indirect taxes were achieved, as the budget deficit is less than half of what had been forecast. In the first four months of the year the balance of the budget showed a deficit of 2.425 billion euros against a deficit of 9.148 billion in the same period last year and a target for a deficit of 5.74 billion euros this year. The primary deficit amounted to 306 million euros, down from 1.73 billion euros in the January-to-April period last year and a target for 3.613 billion this year. Net state budget revenues came to 15.743 billion euros in the year to end-April, posting a rise of 786 million euros or 5.3 percent from the target of 4.957 billion. The revenues from the Public Investments Program posted an increase of 655 million euros from the target, reaching up to 1.715 billion euros. State expenditure came to 18.168 billion euros, posting a considerable decline by 2.53 billion euros from the target set by the budget, and of 28.2 percent or 7.123 billion euros from the same period last year, when Greece paid interest for the bonds included in the debt restructuring (PSI).

Greece/Industry turnover: The Turnover Index in Industry in March fell by 11.5 percent compared to a year earlier, the Hellenic Statistical Authority (ELSTAT) said on Monday. The drop was mainly down to a 51.1 percent decline in turnover in the mining and quarrying sector, while manufacturing turnover also fell by 10.7 percent. Also the New Orders Index in Industry in March 2013 fell by 12.7 percent compared to a year earlier. March’s decrease was a result of new orders for the domestic market falling by 14 percent and orders for the non-domestic market dropping by 12.7 percent.