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Unicredit Net Profit Up 50% in 2010

Ljubljana, 23 March (STA) - The Slovenian subsidiary of the Italian banking group Unicredit posted a net profit of EUR 13.1m in 2010, which is 49.4% more than the year before, executives of Unicredit banka Slovenija told the press on Wednesday.

The bank's operating profit stood at EUR 36.4m, which is 35.3% more than in 2009, while revenues were up by 16.3% to EUR 75m.

In the light of the deteriorating loan portfolio, write-offs and provisions amounted to EUR 20.2m, which is up 19% year-on-year. The bank however managed to boost crediting of the non-banking sector by 10% to EUR 2.3bn.

Board member Janko Medja told the press in Ljubljana that the volume of loans to small and medium-sized companies was up by 2%, while the entire banking system saw a 2% drop in this respect. Loans to medium-sized companies were up by 22%.

Chairman France Arhar said this was one of the proofs dispelling claims that foreign-owned banks in Slovenia are afraid of the crisis and reluctant to give loans to Slovenian businesses.

Loans to the non-banking sector represented 77% of the bank's total assets, which is 13 percentage points more than in 2009, he added.

Unicredit banka Slovenija's total assets were meanwhile down 8.3% to total a little less than EUR 3bn at the end of last year. Arhar explained this was due to Unicredit deciding to abolish liquidity deposits at Banka Slovenije and Bank Austria in view of a stable liquidity situation.

The bank recorded a 16% increase in household deposits, which compares to a 3.7% growth in the entire sector.

Despite the slow recovery of the Slovenian economy, the owners have decided to expand the bank's network in Slovenia with ten new offices in 2011, and a similar pace is expected to be kept in the following years, Arhar said.

He stressed that the owner had been reinvesting the profits in Slovenia for the last ten years and that the profit had not been transferred abroad.

Arhar expressed hope that the owner will approve a capital injection at the bank at April's meeting of shareholders, which according to him would provide for the bank's organic growth in the coming years.

The chairman also annonced that the Unicredit Group had received a direct invitation to buy a 75% stake in Banka Celje, which is being sold by Slovenia's biggest bank, NLB, together with other shareholders.

Arhar indicated that Unicredit was not interested in the stake, however, saying that an indirect answers to the proposal was found in the planned expansion of the bank's network in Slovenia, which envisages organic growth.

With a 40.99% stake, NLB is the biggest owner of the Celje-based bank, which controls around 5% of the market in Slovenia. The call for bids published in February runs out on 8 April.

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