TIDMBOCH
RNS Number : 7759I
Bank of Cyprus Holdings PLC
09 August 2023
Independent review report to Bank of Cyprus Holdings Public
Limited Company
Report on the consolidated condensed interim financial
statements
Our conclusion
We have reviewed Bank of Cyprus Holdings Public Limited
Company's consolidated condensed interim financial statements (the
"interim financial statements") in the Interim Financial Report of
Bank of Cyprus Holdings Public Limited Company for the six month
period ended 30 June 2023 (the "period").
Based on our review, nothing has come to our attention that
causes us to believe that the interim financial statements are not
prepared, in all material respects, in accordance with
International Accounting Standard 34, 'Interim Financial
Reporting', as adopted by the European Union and the Transparency
(Directive 2004/109/EC) Regulations 2007, as amended, Part 2
(Transparency Requirements) of the Central Bank (Investment Market
Conduct) Rules 2019 and the applicable requirements of the
Disclosure Guidance and Transparency Rules of the UK's Financial
Conduct Authority .
The interim financial statements, comprise:
-- The Interim Consolidated Balance Sheet as at 30 June 2023;
-- the Interim Consolidated Income Statement and the Interim
Consolidated Statement of Comprehensive Income for the period then
ended;
-- the Interim Consolidated Statement of Cash Flows for the period then ended;
-- the Interim Consolidated Statement of Changes in Equity for the period then ended; and
-- the explanatory notes to the interim financial statements.
The interim financial statements included in the Interim
Financial Report have been prepared in accordance with
International Accounting Standard 34, 'Interim Financial
Reporting', as adopted by the European Union and the Transparency
(Directive 2004/109/EC) Regulations 2007, as amended, Part 2
(Transparency Requirements) of the Central Bank (Investment Market
Conduct) Rules 2019 and the applicable requirements of the
Disclosure Guidance and Transparency Rules of the UK's Financial
Conduct Authority .
As disclosed in note 3.2 to the interim financial statements,
the financial reporting framework that has been applied in the
preparation of the full annual financial statements of the group is
applicable law and International Financial Reporting Standards
(IFRSs) as adopted by the European Union.
Basis for conclusion
We conducted our review in accordance with International
Standard on Review Engagements (Ireland) 2410, 'Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity' ("ISRE (Ireland) 2410") issued for use in Ireland. A review
of interim financial information consists of making enquiries,
primarily of persons responsible for financial and accounting
matters, and applying analytical and other review procedures.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (Ireland)
and, consequently, does not enable us to obtain assurance that we
would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit
opinion.
We have read the other information contained in the Interim
Financial Report and considered whether it contains any apparent
misstatements or material inconsistencies with the information in
the interim financial statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than
those performed in an audit as described in the Basis for
conclusion section of this report, nothing has come to our
attention to suggest that the directors have inappropriately
adopted the going concern basis of accounting or that the directors
have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This conclusion is based on the review procedures performed in
accordance with ISRE (Ireland) 2410. However future events or
conditions may cause the group to cease to continue as a going
concern.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the directors
The Interim Financial Report, including the interim financial
statements, is the responsibility of, and has been approved by, the
directors. The directors are responsible for preparing the Interim
Financial Report in accordance with the Transparency (Directive
2004/109/EC) Regulations 2007, as amended, Part 2 (Transparency
Requirements) of the Central Bank (Investment Market Conduct) Rules
2019 and the applicable requirements of the Disclosure Guidance and
Transparency Rules of the UK's Financial Conduct Authority . In
preparing the Interim Financial Report including the interim
financial statements, the directors are responsible for assessing
the group's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to
liquidate the group or to cease operations, or have no realistic
alternative but to do so.
Our responsibility is to express a conclusion on the interim
financial statements in the Interim Financial Report based on our
review. Our conclusion, including our Conclusions relating to going
concern, is based on procedures that are less extensive than audit
procedures, as described in the Basis for conclusion paragraph of
this report. This report, including the conclusion, has been
prepared for and only for the company for the purpose of complying
with the Transparency (Directive 2004/109/EC) Regulations 2007, as
amended, Part 2 (Transparency Requirements) of the Central Bank
(Investment Market Conduct) Rules 2019 and the applicable
requirements of the Disclosure Guidance and Transparency Rules of
the UK's Financial Conduct Authority and for no other purpose. We
do not, in giving this conclusion, accept or assume responsibility
for any other purpose or to any other person to whom this report is
shown or into whose hands it may come save where expressly agreed
by our prior consent in writing.
PricewaterhouseCoopers
Chartered Accountants
8 August 2023
Dublin
Alternative Performance Measures Disclosures
30 June 2023
DEFINITIONS
Allowance for Allowance for expected credit losses on loans comprises:
expected credit (i) allowance for expected credit losses (ECL) on
losses on loans loans and advances to customers (including allowance
for expected credit losses on loans and advances
to customers classified as non-current assets held
for sale, where applicable) , (ii) the residual fair
value adjustment on initial recognition of loans
and advances to customers (including residual fair
value adjustment on initial recognition of loans
and advances to customers held for sale, where applicable
), (iii) allowance for expected credit losses on
off-balance sheet exposures ( financial guarantees
and commitments) disclosed on the balance sheet within
other liabilities and (iv) the aggregate fair value
adjustment on loans and advances to customers classified
and measured at FVPL.
Cost to income Cost to income ratio is calculated as total expenses
ratio per the underlying basis (as defined below) divided
by total income as per the underlying basis (as defined
below).
Digitally engaged This is the ratio of digitally engaged individual
customers ratio customers to the total number of individual customers.
Digitally engaged customers are the individuals who
use the digital channels of BOC PCL (mobile banking
app, browser and ATMs) to perform banking transactions,
as well as digital enablers such as a bank-issued
card to perform online card purchases, based on an
internally developed scorecard.
Gross loans Gross Loans comprise: (i) gross loans and advances
to customers measured at amortised cost before the
residual fair value adjustment on initial recognition
(including loans and advances to customers classified
as non-current assets held for sale, where applicable)
and (ii) loans and advances to customers classified
and measured at FVPL adjusted for the aggregate fair
value adjustment.
The residual fair value adjustment on initial recognition
relates mainly to loans acquired from Laiki Bank
(calculated as the difference between the outstanding
contractual amount and the fair value of loans acquired
at acquisition).
Interest earning Interest earning assets include: cash and balances
assets with central banks, plus loans and advances to banks,
plus net loans and advances to customers (including
net loans and advances to customers classified as
non-current assets held for sale , where applicable
) (as defined below), plus deferred consideration
receivable ('DPP'), plus investments (excluding equities,
mutual funds and other non-interest bearing investments).
Legacy exposures Legacy exposures are exposures relating to
(i) Restructuring and Recoveries Division (RRD),
(ii) Real Estate Management Unit (REMU), and
(iii) Non-core overseas exposures.
Leverage ratio The leverage ratio is the ratio of tangible total
equity to total assets as presented on the balance
sheet. Tangible total equity comprises of equity
attributable to the owners of the Company and Other
equity instruments minus intangible assets.
Loan credit Loan credit losses comprise: (i) credit losses to
losses cover credit risk on loans and advances to customers,
(ii) net gains on derecognition of financial assets
measured at amortised cost relating to loans and
advances to customers and (iii) net gains on loans
and advances to customers at FVPL, for the period/year.
Loan credit Loan credit losses charge (cost of risk) (year to
losses charge date) is calculated as the loan credit losses (as
(cost of risk) defined) (annualised based on year to date days)
divided by the average gross loans (as defined).
The average gross loans are calculated as the average
of the opening balance and the closing balance of
Gross loans (as defined), for the reporting period/year.
Net fee and Fee and commission income less fee and commission
commission income expense divided by total income (as defined).
over total income
Net Interest Net interest margin is calculated as the net interest
Margin income (annualised based on year to date days) divided
by the quarterly average interest earning assets
(as defined). Quarterly average interest earning
assets exclude interest earning assets of any discontinued
operations at each quarter end, if applicable.
Net loans and Net loans and advances to customers comprise gross
advances to loans (as defined) net of allowance for expected
customers credit losses on loans (as defined, but excluding
allowance for expected credit losses on off-balance
sheet exposures disclosed on the balance sheet within
other liabilities).
Net loans to Net loans to deposits ratio is calculated as the
deposits ratio gross loans (as defined) net of allowance for expected
credit losses on loans (as defined), divided by customer
deposits.
Net performing Net performing loan book is the total net loans and
loan book advances to customers (as defined) excluding net
loans included in legacy exposures (as defined).
New lending New lending includes the disbursed amounts of the
new and existing non-revolving facilities (excluding
forborne or re-negotiated accounts) as well as the
average year to date change (if positive) of the
current accounts and overdraft facilities between
the balance at the beginning of the period and the
end of the period. Recoveries are excluded from this
calculation since their overdraft movement relates
mostly to accrued interest and not to new lending.
Non-performing As per the EBA standards and European Central Bank's
exposures (NPEs) (ECB) Guidance to Banks on Non-Performing Loans (which
was published in March 2017), NPEs are defined as
those exposures that satisfy one of the following
conditions:
(i) The borrower is assessed as unlikely to pay its
credit obligations in full without the realisation
of the collateral, regardless of the existence of
any past due amount or of the number of days past
due.
(ii) Defaulted or impaired exposures as per the approach
provided in the Capital Requirement Regulation (CRR),
which would also trigger a default under specific
credit adjustment, diminished financial obligation
and obligor bankruptcy.
(iii) Material exposures as set by the Central Bank
of Cyprus (CBC), which are more than 90 days past
due.
(iv) Performing forborne exposures under probation
for which additional forbearance measures are extended.
(v) Performing forborne exposures previously classified
as NPES that present more than 30 days past due within
the probation period.
From 1 January 2021 two regulatory guidelines came
into force that affect NPE classification and Days-Past-Due
calculation. More specifically, these are the RTS
on the Materiality Threshold of Credit Obligations
Past-Due (EBA/RTS/2016/06), and the Guideline on
the Application of the Definition of Default under
article 178 (EBA/GL/2016/07).
The Days-Past-Due (DPD) counter begins counting DPD
as soon as the arrears or excesses of an exposure
reach the materiality threshold (rather than as of
the first day of presenting any amount of arrears
or excesses). Similarly, the counter will be set
to zero when the arrears or excesses drop below the
materiality threshold. Payments towards the exposure
that do not reduce the arrears/excesses below the
materiality threshold, will not impact the counter.
For retail debtors, when a specific part of the exposures
of a customer that fulfils the NPE criteria set out
above is greater than 20% of the gross carrying amount
of all on-balance sheet exposures of that customer,
then the total customer exposure is classified as
non--performing; otherwise only the specific part
of the exposure is classified as non--performing.
For non--retail debtors, when an exposure fulfils
the NPE criteria set out above, then the total customer
exposure is classified as non--performing.
Material arrears/excesses are defined as follows:
* Retail exposures: Total arrears/excess amount greater
than EUR100
* Exposures other than retail: Total arrears/excess
amount greater than EUR500
and the amount in arrears/excess is at least 1% of
the customer's total exposure.
The NPEs are reported before the deduction of allowance
for expected credit losses on loans (as defined).
Non-recurring Non-recurring items as presented in the 'Consolidated
items Income Statement on the underlying basis' relate
to 'Advisory and other transformation costs - organic'
(2022: Non-recurring items relate to: (i) Advisory
and Other transformation costs-ongoing (ii) Provisions/net
loss relating to NPE sales, (iii) Restructuring and
other costs relating to NPE sales, and (iv) Restructuring
costs - Voluntary Staff Exit Plan (VEP), as applicable).
NPE coverage The NPE coverage ratio is calculated as the allowance
ratio for expected credit losses on loans on an underlying
basis (as defined) over NPEs (as defined).
NPE ratio The NPE ratio is calculated as the NPEs (as defined)
divided by gross loans (as defined).
Operating profit Operating profit on an underlying basis comprises
profit before loan credit losses (as defined), impairments
of other financial and non-financial assets, provisions
for litigation, claims, regulatory and other matters
(net of reversals), tax, profit attributable to non-controlling
interests and non-recurring items (as defined).
Operating profit Operating profit return on average assets is calculated
return on average as the annualised (based on year to date days) operating
assets profit on an underlying basis (as defined) divided
by the quarterly average of total assets for the
relevant period. Average total assets exclude total
assets of discontinued operations at each quarter
end, if applicable.
Profit/(loss) Profit/(loss) after tax and before non-recurring
after tax and items (attributable to the owners of the Company)
before non-recurring is the operating profit (as defined) adjusted for
items (attributable loan credit losses (as defined), impairments of other
to the owners financial and non-financial assets, provisions for
of the Company) litigation, claims, regulatory and other matters
(net of reversals), tax and (profit)/loss attributable
to non-controlling interests.
Profit/(loss) Profit/(loss) after tax - organic (attributable to
after tax - the owners of the Company) is the profit/(loss) after
organic (attributable tax and before non-recurring items (as defined) (attributable
to the owners to the owners of the Company), adjusted for the 'Advisory
of the Company) and other transformation costs - organic'.
Return on Tangible Return on Tangible Equity (ROTE) after tax and before
Equity (ROTE) non-recurring items is calculated as Profit/(loss)
after tax and after tax and before non-recurring items (attributable
before non-recurring to the owners of the Company) (as defined) per the
items underlying basis (annualised - (based on year-to-date
days)), divided by the quarterly average of Shareholders'
equity minus intangible assets at each quarter end.
Return on Tangible Return on Tangible Equity (ROTE) is calculated as
Equity (ROTE) Profit/(loss) after tax (attributable to the owners
of the Company) (annualised - (based on year-to-date
days)), divided by the quarterly average of Shareholders'
equity minus intangible assets at each quarter end.
Shareholders' Shareholders' equity comprise total equity adjusted
equity for non-controlling interest and other equity instruments.
Time deposit Calculated as a percentage of the cost (interest
pass-through expense) of Time and Notice deposits over the average
6-month Euribor rate of the period.
Total expenses Total expenses on the underlying basis comprise the
total staff costs, special levy on deposits and other
levies/contributions and other operating expenses
(excluding 'Advisory and other transformation costs-organic',
(on an underlying basis) as reconciled in the table
further below) (2022: total expenses on the underlying
basis comprise total staff costs (excluding 'Restructuring
costs - Voluntary Staff Exit Plan (VEP)') (on an
underlying basis as reconciled in the table further
below), special levy on deposits and other levies/contributions
and other operating expenses (excluding 'Advisory
and other transformation costs-organic', 'Restructuring
and other costs relating to NPE sales', on an underlying
basis as reconciled in the table further below)).
Total income Total income on the underlying basis comprises the
total of net interest income, net fee and commission
income , net foreign exchange gains, net gains/(losses)
on financial instruments ( excluding net gains/(losses)
on loans and advances to customers at FVPL) , net
insurance result, net gains/(losses) from revaluation
and disposal of investment properties and on disposal
of stock of property and other income (on an underlying
basis) . A reconciliation of these amounts between
the statutory and the underlying bases is disclosed
in the Interim Management Report under section 'Group
financial results on the underlying basis'.
RECONCILIATIONS
For the purpose of the 'Alternative Performance Measures
Disclosures', reference to 'Note' relates to the respective note in
the Consolidated Condensed Interim Financial Statements for the six
months ended 30 June 2023.
Reconciliations between the calculations of non-IFRS performance
measures and the most directly comparable IFRS measures which allow
for the comparability of the underlying basis to statutory
information are disclosed below.
On 1 January 2023, the Group adopted IFRS 17 'Insurance
Contracts'. As required by the standard, the Group applied the
requirements retrospectively with comparative information
previously published under IFRS 4 'Insurance Contracts' restated
from 1 January 2022, the transition date and therefore
reconciliations of alternative performance measures have also been
restated, where applicable.
1. Reconciliation of Gross loans and advances to customers
30 June 31 December
2023 2022
EUR000 EUR000
=========== ============
Gross loans and advances to customers as
per the underlying basis (as defined above) 10,277,457 10,217,453
=========== ============
Reconciling items:
=========== ============
Residual fair value adjustment on initial
recognition (Note 18) (74,998) (89,029)
=========== ============
Loans and advances to customers measured
at fair value through profit or loss (Note
18) (210,385) (214,359)
=========== ============
Aggregate fair value adjustment on loans
and advances to customers measured at fair
value through profit or loss 3,261 3,270
----------- ------------
Gross loans and advances to customers at
amortised cost as per the Consolidated Condensed
Interim Financial Statements (Note 18) 9,995,335 9,917,335
=========== ============
2. Reconciliation of Allowance for expected credit losses (ECL)
on loans and advances to customers
30 June 31 December
2023 2022
EUR000 EUR000
========= ============
Allowance for expected credit losses on
loans and advances to customers (ECL) as
per the underlying basis (as defined above) 287,645 281,630
========= ============
Reconciling items:
========= ============
Residual fair value adjustment on initial
recognition (Note 18) (74,998) (89,029)
========= ============
Aggregate fair value adjustment on loans
and advances to customers measured at fair
value through profit or loss 3,261 3,270
========= ============
Provisions for financial guarantees and
commitments (Note 24) (18,007) (17,429)
--------- ------------
Allowance for ECL for impairment of loans
and advances to customers as per the Consolidated
Condensed Interim Financial Statements (Note
18) 197,901 178,442
========= ============
3. Reconciliation of NPEs
30 June 31 December
2023 2022
EUR000 EUR000
=========== ============
NPEs as per the underlying basis (as defined
above) 371,091 410,563
=========== ============
Reconciling items:
=========== ============
POCI (NPEs) (Note 1 below) (35,866) (37,742)
=========== ============
Residual fair value adjustment on initial
recognition of loans and advances to customers
(NPEs) classified as Stage 3 (Note 18) (1,433) (1,803)
----------- ------------
Stage 3 gross loans and advances to customers
at amortised cost as per the Consolidated
Condensed Interim Financial Statements (Note
18) 333,792 371,018
=========== ============
NPE ratio
=========== ============
NPEs (as per table above) (EUR000) 371,091 410,563
=========== ============
Gross loans and advances to customers (as
per table above) (EUR000) 10,277,457 10,217,453
=========== ============
Ratio of NPE/Gross loans (%) 3.6% 4.0%
=========== ============
Note 1 : Gross loans and advances to customers at amortised cost
before residual fair value adjustment on initial recognition
include an amount of EUR35,866 thousand POCI - Stage 3 loans (out
of a total of EUR107,622 thousand POCI loans) (31 December 2022:
EUR37,742 thousand POCI - Stage 3 loans (out of a total of
EUR115,544 thousand POCI loans)) as disclosed in Note 18 of the
Consolidated Condensed Interim Financial Statements for the six
months ended 30 June 2023.
4. Reconciliation of Loan credit losses
Six months ended
30 June
2023 2022
========= ========
EUR000 EUR000
========= ========
Loan credit losses as per the underlying
basis 24,397 23,118
========= ========
Reconciling items:
========= ========
Loan credit losses relating to NPE sales,
disclosed under non-recurring items within
'Provisions/net loss relating to NPE sales'
under the underlying basis - 385
========= ========
24,397 23,503
========= ========
Loan credit losses (as defined) are reconciled
to the statutory basis as follows:
========= ========
Credit losses to cover credit risk on
loans and advances to customers (Note
12) 30,290 23,959
========= ========
Net gains on derecognition of financial
assets measured at amortised cost - loans
and advances to customers (see further
below) (5,902) (2,515)
========= ========
Net losses on loans and advances to customers
at FVPL (Note 10) 9 2,059
--------- --------
24,397 23,503
========= ========
Net gains on derecognition of financial assets measured at
amortised cost on the Interim Consolidated Income Statement amount
to EUR5,861 thousand (30 June 2022: EUR1,648 thousand) and comprise
EUR5,902 thousand (30 June 2022: EUR2,515 thousand) net gains on
derecognition of loans and advances to customers and EUR41 thousand
(30 June 2022: EUR867 thousand) net losses on derecognition of debt
securities measured at amortised cost.
KEY PERFORMANCE RATIOS INFORMATION
For the purpose of the 'Alternative Performance Measures
Disclosures', reference to 'Note' relates to the respective note in
the Consolidated Condensed Interim Financial Statements for the six
months ended 30 June 2023
1. Net Interest Margin
The various components for the calculation of net interest
margin are provided below:
1.1 Net interest income used in the calculation Six months ended
of NIM 30 June
2023 2022
(restated)
=========== ============
EUR000 EUR000
=========== ============
Net interest income as per the underlying
basis/statutory basis 358,342 145,722
=========== ============
Net interest income used in the calculation
of NIM (annualized) 722,623 293,859
=========== ============
1.2 Interest 30 June 31 March 31 December
earning assets 2023 2023 2022
=========== =========== ============
EUR000 EUR000 EUR000
=========== =========== ============
Cash and balances with central banks 9,127,429 9,247,705 9,567,258
=========== =========== ============
Loans and advances to banks 431,812 415,832 204,811
=========== =========== ============
Loans and advances to customers 10,007,819 10,013,108 9,953,252
=========== =========== ============
Prepayments, accrued income and other
assets - Deferred consideration receivable
('DPP') (Note 20) 320,655 315,755 311,523
=========== =========== ============
Investments
=========== =========== ============
Debt securities (Note 15) 3,178,127 2,746,790 2,499,894
=========== =========== ============
Total interest earning assets 23,065,842 22,739,190 22,536,738
=========== =========== ============
1.3 Quarterly average interest earning
assets (EUR000)
=========== =========== ============
* as at 30 June 2023 22,780,590
=========== =========== ============
* as at 30 June 2022 22,235,482
=========== =========== ============
1.4 Net interest margin (NIM) Six months ended
30 June
2023 2022
(restated)
=========== ============
Net interest income (annualised) (as per table
1.1 above) (EUR000) 722,623 293,859
=========== ------------
Quarterly average interest earning assets
(as per table 1.3 above) (EUR000) 22,780,590 22,235,482
=========== ============
NIM (%) 3.17% 1.32%
=========== ============
2. Cost to income ratio
2.1 Reconciliation of the various components of total expenses
used in the cost to income ratio calculation from the underlying
basis to the statutory basis is provided below:
2.1.1 Reconciliation of Staff costs Six months ended
30 June
=========================
2023 2022
(restated)
======= ================
EUR000 EUR000
======= ================
Total Staff costs as per the underlying basis 93,043 95,173
======= ================
Reclassifications for:
======= ================
Restructuring costs - separately presented
under the underlying basis in 2022 n/a 3,130
------- ----------------
Staff costs as per the statutory basis (Note
11) 93,043 98,303
======= ================
2.1.2 Reconciliation of Other operating expenses Six months ended
30 June
2023 2022 (restated)
======= ================
EUR000 EUR000
======= ================
Other operating expenses as per the underlying
basis 68,199 69,149
======= ================
Reclassifications for:
======= ================
Operating expenses and restructuring costs
relating to the NPE sales, presented within
'Restructuring and other costs relating to
NPE sales' under the underlying basis n/a 1,389
======= ================
Advisory and other transformation costs - organic,
separately presented under the underlying basis 2,257 5,286
------- ================
Other operating expenses as per the statutory
basis (Note 11) 70,456 75,824
======= ================
Reconciliation of the various components of total income used in
the cost to income ratio calculation from the underlying basis to
the statutory basis is provided below:
2. 2 Total Income as per the underlying basis Six months ended
30 June
2023 2022 (restated)
======== ================
EUR000 EUR000
======== ================
Net interest income as per the underlying
basis/statutory basis (as per table 1.1 above) 358,342 145,722
======== ================
Net fee and commission income as per the underlying
basis/statutory basis 89,604 93,639
======== ================
Net foreign exchange gains, Net gains/(losses)
on financial instruments and Net gains on
derecognition of financial assets measured
at amortised cost as per the underlying basis
(as per table 2.3 below) 21,487 2,907
======== ================
Net insurance result (Note below) 24,561 23,724
======== ================
Net losses from revaluation and disposal of
investment properties and Net gains on disposal
of stock of properties (as per the statutory
basis) 4,694 6,870
======== ================
Other income (as per the statutory basis) 12,200 8,927
-------- ----------------
Total Income as per the underlying basis 510,888 281,789
======== ================
Net insurance result comprises the aggregate of captions 'Net
insurance finance income/(expense) and Net reinsurance finance
income/(expense)', 'Net insurance service result' and 'Net
reinsurance service result' per the statutory basis.
2. Cost to income ratio (continued)
2.3 Reconciliation of Net foreign exchange gains, Six months ended
Net gains/ (losses) on financial instruments 30 June
and Net gains on derecognition of financial
assets measured at amortised cost between the
statutory basis and the underlying basis
20 2 3 2022 (restated)
================= ==================
EUR000 EUR000
================= ==================
Net foreign exchange gains, Net gains/(losses)
on financial instruments and Net gains on derecognition
of financial assets measured at amortised cost
as per the underlying basis 21,487 2,907
================= ==================
Reclassifications for:
================= ==================
Net losses on loans and advances to customers
measured at fair value through profit or loss
(FVPL), disclosed within 'Loan credit losses'
per the underlying basis (Note 10) (9) (2,059)
================= ==================
Net gains on derecognition of financial assets
measured at amortised cost - loans and advances
to customers (Table 4 Section 'Reconciliations'
above) 5,902 2,515
================= ==================
Net foreign exchange gains, et gains/(losses)
on financial instruments and Net gains on derecognition
of financial assets measured at amortised cost
as per the statutory basis (see below) 27,380 3,363
================= ==================
Net foreign exchange gains, Net gains/(losses)
on financial instruments and Net gains on derecognition
of financial assets measured at amortised cost
(as per table above) are reconciled to the statutory
basis as follows:
================= ==================
Net foreign exchange gains 15,839 11,898
================= ==================
Net gains/(losses) on financial instruments
(Note 10) 5,680 (10,183)
================= ==================
Net gains on derecognition of financial assets
measured at amortised cost 5,861 1,648
----------------- ------------------
27,380 3,363
================= ==================
2. 4 Total Expenses as per the underlying basis Six months ended
30 June
2023 2022
(restated)
================= ==============
EUR000 EUR000
================= ==============
Staff costs as per the underlying basis (as
per 2.1.1 table above) 93,043 95,173
================= ==============
Special levy on deposits and other levies/contributions
as per the underlying basis/statutory basis 18,236 16,507
================= ==============
Other operating expenses as per the underlying
basis (as per table 2.1.2 above) 68,199 69,149
----------------- --------------
Total Expenses as per the underlying basis 179,478 180,829
================= ==============
Cost to income ratio
================= ==============
Total expenses (as per table 2.4 above) (EUR000) 179,478 180,829
================= ==============
Total income (as per table 2.2 above) (EUR000) 510,888 281,789
================= ==============
Total expenses/Total income (%) 35% 64%
================= ==============
3. Operating profit return on average assets
The various components used in the determination of the
operating profit return on average assets are provided below:
30 June 31 March 31 December
2023 2023 2022
(restated)
EUR000 EUR000 EUR000
========== =========== ============
Total assets used in the computation
of the operating profit return on average
assets/per the Interim Consolidated 25,706,63
Balance Sheet 7 25,386,804 25,288,541
========== =========== ============
Quarterly average total assets (EUR000)
---------- ----------- ------------
* as at 30 June 2023 25,460,661
---------- ----------- ------------
* as at 30 June 2022 (restated) 25,142,255
---------- ----------- ------------
2023 2022
(restated)
Annualised total income for the six months ended
30 June (as per table 2.2 above) (EUR000) 1,030,244 568,249
=========== ============
Annualised total expenses for the six months
ended 30 June (as per table 2.4 above) (EUR000) (361,931) (364,655)
----------- ------------
Annualised operating profit for the six months
ended 30 June (EUR000) 668,313 203,594
=========== ============
Quarterly average total assets as at 30 June
(as per table above) (EUR000) 25,460,661 25,142,255
=========== ============
Operating profit return on average assets (annualised)
(%) 2.6% 0.8%
=========== ============
4. Cost of Risk
Six months ended
30 June
2023 2022
=========== ===========
EUR000 EUR000
=========== ===========
Annualised loan credit losses (as per table
4 in section 'Reconciliation' above) 49,198 46,619
=========== ===========
Average gross loans (as defined) (as per table
1 above) 10,247,455 10,951,845
=========== ===========
Cost of Risk (CoR) % 0.48% 0.43%
=========== ===========
5. Basic earnings after tax and before non-recurring items per
share attributable to the owners of the Company
The various components used in the determination of the 'Basic
earnings after tax and before non-recurring items per share
attributable to the owners of the Company (EUR cent)' are provided
below:
2023 2022
(restated)
Profit after tax and before non-recurring items
(attributable to the owners of the Company)
per the underlying basis for the six months
ended 30 June (as per table 5.1 below) (EUR000) 222,504 52,404
======== ============
Weighted average number of shares in issue during
the period, excluding treasury shares (EUR000)
(Note 14) 446,058 446,058
======== ============
Basic earnings after tax and before non-recurring
items per share attributable to the owners of
the Company (EUR cent) 49.88 11.75
======== ============
The reconciliation between the 'Profit after tax and before
non-recurring items (attributable to the owners of the Company)'
per the underlying basis to the 'Profit after tax (attributable to
the owners of the Company)' per the statutory basis is provided in
the table below:
5.1 Reconciliation of Profit after tax-attributable to the owners of the Company
Six months ended
30 June
2023 2022
(restated)
======== ============
EUR000 EUR000
======== ============
Profit after tax and before non-recurring items
(attributable to the owners of the Company)
per the underlying basis 222,504 52,404
======== ============
Reclassifications for:
======== ============
Loan credit losses relating to NPE sales, disclosed
under non-recurring items within 'Provisions/net
loss relating to NPE sales' under the underlying
basis (as per table 4 in section 'Reconciliations'
above) - (385)
======== ============
Operating expenses and restructuring costs relating
to the NPE sales, presented within 'Restructuring
and other costs relating to NPE sales' under
the underlying basis (as per table 2.1.2 above) - (1,389)
======== ============
Advisory and other transformation costs - organic,
separately presented under the underlying basis
(as per table 2.1.2 above) (2,257) (5,286)
======== ============
Restructuring costs - voluntary exit plan, and
other termination benefits, separately presented
under the underlying basis (as per table 2.1.1
above) - (3,130)
======== ============
Profit after tax (attributable to the owners
of the Company) per the statutory basis 220,247 42,214
======== ============
6. Return on tangible equity (ROTE)
The various components used in the determination of 'Return on
tangible equity (ROTE)' are provided below:
2023 2022
(restated)
Annualised profit after tax (attributable to
the owners of the Company) for the six months
ended 30 June (as per table 5.1 above) (EUR000) 444,145 85,128
========== ============
Quarterly average tangible shareholder's equity
as at 30 June (as per table 6.2 below) (EUR000) 1,846,802 1,751,868
========== ============
ROTE (%) 24.0% 4.9%
========== ============
6.1 Tangible shareholder's equity 30 June 31 March 31 December
2023 2023 2022
(restated)
EUR000 EUR000 EUR000
========== ========== ============
Equity attributable to the owners
of the Company (as per the statutory
basis) 1,984,459 1,899,202 1,806,266
========== ========== ============
Less: Intangible assets (as per the
statutory basis) (47,546) (49,430) (52,546)
========== ========== ============
Total tangible shareholder's equity 1,936,913 1,849,772 1,753,720
========== ========== ============
6.2 Quarterly average tangible shareholder's
equity (EUR000)
========== ========== ============
* as at 30 June 2023 1,846,802
========== ========== ============
* as at 30 June 2022 (restated) 1,751,868
========== ========== ============
7. Leverage ratio
2023 2022
(restated)
Total assets as at 30 June 2023/31 December
2022 (EUR000) 25,706,637 25,288,541
=========== ============
Tangible total equity (including Other equity
instruments) as at 30 June 2023/31 December
2022 (as per table 7.1 below) (EUR000) 2,172,430 1,973,720
=========== ============
Leverage ratio 8.5% 7.8%
=========== ============
7.1 Tangible total equity 30 June 31 December
2023 2022
(restated)
EUR000 EUR000
========== ============
Equity attributable to the owners of the Company
(as per the statutory basis) 1,984,459 1,806,266
========== ============
Other equity instruments 235,517 220,000
========== ============
Less: Intangible assets (as per the statutory
basis) (47,546) (52,546)
========== ============
Total tangible equity 2,172,430 1,973,720
========== ============
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END
IR FIFEETTIAIIV
(END) Dow Jones Newswires
August 09, 2023 02:03 ET (06:03 GMT)
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