REG - Bank of Cyprus Hldgs - Half-year Report -Part 4
09/08/2023 07:15
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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 expected credit losses on loans Allowance for expected credit losses on loans comprises: (i) allowance for
expected credit losses (ECL) on 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 ratio Cost to income ratio is calculated as total expenses per the underlying basis
(as defined below) divided by total income as per the underlying basis (as
defined below).
Digitally engaged customers ratio This is the ratio of digitally engaged individual 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 assets Interest earning assets include: cash and balances 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 losses Loan credit losses comprise: (i) credit losses to 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 losses charge (cost of risk) Loan credit losses charge (cost of risk) (year to date) is calculated as the
loan credit losses (as 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 commission income over total income Fee and commission income less fee and commission expense divided by total
income (as defined).
Net Interest Margin Net interest margin is calculated as the net interest 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 advances to customers Net loans and advances to customers comprise gross loans (as defined) net of
allowance for expected 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 deposits ratio Net loans to deposits ratio is calculated as the gross loans (as defined) net
of allowance for expected credit losses on loans (as defined), divided by
customer deposits.
Net performing loan book Net performing loan book is the total net loans and 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 exposures (NPEs) As per the EBA standards and European Central Bank's (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 €100
- Exposures other than retail: Total arrears/excess amount greater than €500
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 items Non-recurring items as presented in the 'Consolidated 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 ratio The NPE coverage ratio is calculated as the allowance 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 return on average assets Operating profit return on average assets is calculated as the annualised
(based on year to date days) operating 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) after tax and before non-recurring items (attributable to the Profit/(loss) after tax and before non-recurring items (attributable to the
owners of the Company) owners of the Company) is the operating profit (as defined) adjusted for 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 and (profit)/loss attributable to non-controlling
interests.
Profit/(loss) after tax - organic (attributable to the owners of the Company) Profit/(loss) after tax - organic (attributable to the owners of the Company)
is the profit/(loss) after tax and before non-recurring items (as defined)
(attributable to the owners of the Company), adjusted for the 'Advisory and
other transformation costs - organic'.
Return on Tangible Equity (ROTE) after tax and before non-recurring items Return on Tangible Equity (ROTE) after tax and before non-recurring items is
calculated as Profit/(loss) after tax and before non-recurring items
(attributable to the owners of the Company) (as defined) per the 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 Equity (ROTE) Return on Tangible Equity (ROTE) is calculated as 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' equity Shareholders' equity comprise total equity adjusted for non-controlling
interest and other equity instruments.
Time deposit Calculated as a percentage of the cost (interest expense) of Time and Notice
deposits over the average 6-month Euribor rate of the period.
pass-through
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
€000 €000
Gross loans and advances to customers as per the underlying basis (as defined 10,277,457 10,217,453
above)
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 (210,385) (214,359)
(Note 18)
Aggregate fair value adjustment on loans and advances to customers measured at 3,261 3,270
fair value through profit or loss
Gross loans and advances to customers at amortised cost as per the 9,995,335 9,917,335
Consolidated Condensed Interim Financial Statements (Note 18)
2. Reconciliation of Allowance for expected credit losses
(ECL) on loans and advances to customers
30 June 31 December
2023 2022
€000 €000
Allowance for expected credit losses on loans and advances to customers (ECL) 287,645 281,630
as per the underlying basis (as defined above)
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 3,261 3,270
fair value through profit or loss
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 197,901 178,442
Consolidated Condensed Interim Financial Statements (Note 18)
3. Reconciliation of NPEs
30 June 31 December
2023 2022
€000 €000
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 (1,433) (1,803)
customers (NPEs) classified as Stage 3 (Note 18)
Stage 3 gross loans and advances to customers at amortised cost as per the 333,792 371,018
Consolidated Condensed Interim Financial Statements (Note 18)
NPE ratio
NPEs (as per table above) (€000) 371,091 410,563
Gross loans and advances to customers (as per table above) (€000) 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
€35,866 thousand POCI - Stage 3 loans (out of a total of €107,622 thousand
POCI loans) (31 December 2022: €37,742 thousand POCI - Stage 3 loans (out of
a total of €115,544 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
€000 €000
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 - 385
within 'Provisions/net loss relating to NPE sales' under the underlying basis
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 30,290 23,959
12)
Net gains on derecognition of financial assets measured at amortised cost - (5,902) (2,515)
loans and advances to customers (see further below)
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 €5,861 thousand (30 June
2022: €1,648 thousand) and comprise €5,902 thousand (30 June 2022:
€2,515 thousand) net gains on derecognition of loans and advances to
customers and €41 thousand (30 June 2022: €867 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 of NIM Six months ended
30 June
2023 2022
(restated)
€000 €000
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
€000 €000 €000
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 320,655 315,755 311,523
receivable ('DPP') (Note 20)
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 (€000)
- 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) (€000) 722,623 293,859
Quarterly average interest earning assets (as per table 1.3 above) (€000) 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)
€000 €000
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)
€000 €000
Other operating expenses as per the underlying basis 68,199 69,149
Reclassifications for:
Operating expenses and restructuring costs relating to the NPE sales, n/a 1,389
presented within 'Restructuring and other costs relating to NPE sales' under
the underlying basis
Advisory and other transformation costs - organic, separately presented under 2,257 5,286
the underlying basis
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)
€000 €000
Net interest income as per the underlying basis/statutory basis (as per table 358,342 145,722
1.1 above)
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 21,487 2,907
Net gains on derecognition of financial assets measured at amortised cost as
per the underlying basis (as per table 2.3 below)
Net insurance result (Note below) 24,561 23,724
Net losses from revaluation and disposal of investment properties and Net 4,694 6,870
gains on disposal of stock of properties (as per the statutory basis)
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, Net gains/ Six months ended
(losses) on financial instruments and Net gains on derecognition of financial
30 June
assets measured at amortised cost between the statutory basis and the
underlying basis
2023 2022 (restated)
€000 €000
Net foreign exchange gains, Net gains/(losses) on financial instruments and 21,487 2,907
Net gains on derecognition of financial assets measured at amortised cost as
per the underlying basis
Reclassifications for:
Net losses on loans and advances to customers measured at fair value through (9) (2,059)
profit or loss (FVPL), disclosed within 'Loan credit losses' per the
underlying basis (Note 10)
Net gains on derecognition of financial assets measured at amortised cost - 5,902 2,515
loans and advances to customers (Table 4 Section 'Reconciliations' above)
Net foreign exchange gains, Νet gains/(losses) on financial instruments and 27,380 3,363
Net gains on derecognition of financial assets measured at amortised cost as
per the statutory basis (see below)
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)
€000 €000
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 18,236 16,507
basis/statutory basis
Other operating expenses as per the underlying basis (as per table 2.1.2 68,199 69,149
above)
Total Expenses as per the underlying basis 179,478 180,829
Cost to income ratio
Total expenses (as per table 2.4 above) (€000) 179,478 180,829
Total income (as per table 2.2 above) (€000) 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)
€000 €000 €000
Total assets used in the computation of the operating profit return on average 25,706,637 25,386,804 25,288,541
assets/per the Interim Consolidated Balance Sheet
Quarterly average total assets (€000)
- 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 1,030,244 568,249
above) (€000)
Annualised total expenses for the six months ended 30 June (as per table 2.4 (361,931) (364,655)
above) (€000)
Annualised operating profit for the six months ended 30 June (€000) 668,313 203,594
Quarterly average total assets as at 30 June (as per table above) (€000) 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
€000 €000
Annualised loan credit losses (as per table 4 in section 'Reconciliation' 49,198 46,619
above)
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 (€ cent)' are provided below:
2023 2022
(restated)
Profit after tax and before non-recurring items (attributable to the owners of 222,504 52,404
the Company) per the underlying basis for the six months ended 30 June (as per
table 5.1 below) (€000)
Weighted average number of shares in issue during the period, excluding 446,058 446,058
treasury shares (€000) (Note 14)
Basic earnings after tax and before non-recurring items per share attributable 49.88 11.75
to the owners of the Company (€ cent)
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)
€000 €000
Profit after tax and before non-recurring items (attributable to the owners of 222,504 52,404
the Company) per the underlying basis
Reclassifications for:
Loan credit losses relating to NPE sales, disclosed under non-recurring items - (385)
within 'Provisions/net loss relating to NPE sales' under the underlying basis
(as per table 4 in section 'Reconciliations' above)
Operating expenses and restructuring costs relating to the NPE sales, - (1,389)
presented within 'Restructuring and other costs relating to NPE sales' under
the underlying basis (as per table 2.1.2 above)
Advisory and other transformation costs - organic, separately presented under (2,257) (5,286)
the underlying basis (as per table 2.1.2 above)
Restructuring costs - voluntary exit plan, and other termination benefits, - (3,130)
separately presented under the underlying basis (as per table 2.1.1 above)
Profit after tax (attributable to the owners of the Company) per the statutory 220,247 42,214
basis
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 444,145 85,128
the six months ended 30 June (as per table 5.1 above) (€000)
Quarterly average tangible shareholder's equity as at 30 June (as per table 1,846,802 1,751,868
6.2 below) (€000)
ROTE (%) 24.0% 4.9%
6.1 Tangible shareholder's equity 30 June 31 March 31 December
2023 2023 2022
(restated)
€000 €000 €000
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 (€000)
- 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 (€000) 25,706,637 25,288,541
Tangible total equity (including Other equity instruments) as at 30 June 2,172,430 1,973,720
2023/31 December 2022 (as per table 7.1 below) (€000)
Leverage ratio 8.5% 7.8%
7.1 Tangible total equity 30 June 31 December
2023 2022
(restated)
€000 €000
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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