Raiffeisen International's first-quarter pre-tax profits have doubled to EUR166m, helped by decline in the previous year’s large provisions to cover impairment losses.
Net allocations to provisions for impairment losses in the first quarter of 2010 declined by 33.8% year-on-year to EUR295m compared to EUR 445m in the first quarter of last year.
Raiffeisen International’s return on equity before tax for the first quarter improved by 4.3 percentage points year-on-year to 9.6% compared to 5.3% in the same quarter of 2009.
Herbert Stepic, CEO of Raiffeisen International, said: “We nearly doubled our profit before tax on a year-on-year basis due to the decline in our net allocations to provisions for impairment losses. Our results reflect the slight economic recovery that is taking place in Central and Eastern Europe. Consequently, our confidence in the region’s long-term potential remains unbroken.”
Walter Rothensteiner, chairman of the supervisory board of Raiffeisen International, said: “We applied strong transparency criteria and the utmost care when pursuing the valuation according to international standards and national guidelines. We are confident that market participants will see these principles reflected in the enterprise valuations and the exchange ratio we have put forward.”
Raiffeisen, a member of Austrian commercial and investment banking group RZB Group, is said to be moving forward with its plans to merge with selected operations of RZB, that owns 73% of its shares. The merged entity will be called Raiffeisen Bank International and will retain Raiffeisen’s stock market listing.