Alpha Bank posts Q3 losses on higher loan provisions

Alpha Bank, one of the country’s four largest banks, swung to a net loss in the third quarter after a profit in the previous quarter, on higher loan-loss provisions.

Alpha Bank posted net losses of €171.3 million in July to September versus a net profit of €95.7 million in the second quarter.

Alpha, which is 9% owned by Greece’s HFSF bank rescue fund, said loan impairment provisions stood at €437 million in the third quarter versus €127.9 million in the second quarter mainly due to the transactions of two bad loan portfolios, “Cosmos” and “Orbit.”

“The Cosmos portfolio has been reclassified as held for sale following the agreement reached with Davidson Kempner, enabling a very meaningful reduction of our non-performing exposures,” Chief Executive Vassilis Psaltis said in a statement.

Alpha Bank and Davidson Kempner signed earlier this year an agreement for the securitisation of €3.4 billion of bad loans knows as the Cosmos project.

The group’s non-performing exposures (NPEs) ratio stood at 16.6% at the end of September, down from 23.8% at the end of the second quarter.

“[We are] On track to reach 13% by year-end and a single-digit by mid-2022,” Psaltis said.

The bank’s Core Equity Tier 1 capital ratio stood at 13.9% with net interest income falling 14.2% quarter on quarter to €318.5 million. [Reuters]