LISBON--Banco Comercial Portugues SA (BPCGY, BCP.LB) said Monday
that it swung to a first-quarter net loss, hampered by higher
provisions for past-due loans and a loss from its recently sold
Greek unit.
Portugal's second-largest bank by market value reported a net
loss of 152 million euros ($198.6 million) in the first quarter,
compared with a EUR40.8 million net profit reported in the same
quarter the year before. The result was largely in line with the
EUR153.1 million expected by a Dow Jones Newswires poll of three
analysts.
The bank's bottom line was hurt by a negative contribution from
its operations in Greece, which were sold in April to Greece's
Piraeus Bank SA (TPEIR.AT). The transaction will enable BCP to
deconsolidate about EUR4 billion of right-weighted assets of its
unit, it said. According to BCP, its net loss excluding Greek
operations would have been a narrower EUR109.7 million.
BCP also said bad-debt charges rose to EUR188.4 million from
EUR152.3 million, as the country's austerity measures continue to
pressure loan books and to force banks to set aside more money to
cover souring loans. The ratio of credit at risk stood at 13.8% of
total loans at the end of March, from 10.9% the year before.
Portugal's economy is expected to slump 2.3% this year, bending
under the pressure of a belt-tightening effort related to a EUR78
billion international bailout.
The bank's net interest income--the difference between interest
paid on deposits and those charged on loans--fell to EUR183 million
from EUR309.4 million, including a EUR66.6 million cost of
borrowing money from the Portuguese government in the form of
contingent convertible bonds.
The so-called CoCos are sold as interest-bearing debt that has
to be paid back, and were part of BCP's recapitalization plan.
The bank also said its trading profit tumbled to EUR74.7
million, from EUR174 million a year earlier.
The bank's core Tier 1 capital ratio stood at 9.6% as of March
31, according to requirements set by the European Banking
Authority.
-Write to Carla Canivete of Webtexto at
carla.canivete@dowjones.com
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