Portugal: Caixa Geral Q1 net loss of €38.6m ‘in line with strategic plan’

Page created: Friday, 19 May 2017 8:50 GMT

Caixa Geral de Depósitos  CGD   Earnings Report   Q1 2017

Lisbon, May 18 (Lusa) – Portugal’s state-owned bank, Caixa Geral de Depósitos (CGD), which is also the country’s largest, on Thursday announced a first-quarter net loss of €38.6 million, down from a loss of €74 million in the same period of last year.

“The results are in line with the strategic plan [and] show quite adequate capital ratios and a good development in terms of liquidity,” said the bank’s chief executive, Paulo Macedo, at a news conference in Lisbon to present the results. “There is also an improvement in the margin and banking product.”

According to the bank, the net result in the quarter was weighed down by non-recurring costs of €58 million (€42.1 million euros net of tax) and the net recurring profit was €3.5 million.

These extraordinary costs have to do with the early retirement programme and voluntary redundancies that the bank is pushing through, in a bid to reduce costs for the long term.

The financial margin swelled 18% to €326.1 million thanks to lower funding costs. The fact that CGD no longer had to pay interest on the CoCo (convertible bonds that it had issued to the Portuguese state, to boost its financial ratios) also helped here.

Net commissions were down 3.7% to €109 million while the result of financial operations was €81 million, against a negative result of €98 million in the first quarter of 2016.

The banking product soared 65% to €490 million.

Operating costs, meanwhile, increased 16% to €345 million.

Provisions and impairments were up 35% to €113 million.