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Two main banks see big fall in profits

MARFIN Popular Bank (MPB) saw a 61.7 per cent drop in its first-quarter net profit to ?40 million, it said yesterday, while Bank of Cyprus (BoC) said it also saw a 46 per cent drop in its first-quarter net profit to ?63 million.

MPB said its results were impacted by a deterioration in capital markets and higher costs of money, and the bank's decision to increase its provisioning to buffer the group from future risks. Net interest income fell 28.3 per cent to ?122.6 million. Pre-tax profit fell 59.5 per cent to ?44.1 million, the group said.

It said it increased its provisions by 95 per cent to ?48.6 million. The level of non-performing loans over total group loans increased marginally, the bank said, to 5.1 per cent.

Meanwhile BoC said group net interest income declined 2.0 per cent to ?181 million while pre tax profit fell 41 percent to ?79 million compared with a year ago.

"Having taken into consideration the results for the first quarter 2009 and the results to date, particularly the improvement of the spreads between deposits and loans in April and May, the group estimates that it will achieve satisfactory profitability for the year 2009 that will be within the estimated range already announced," BoC said in a statement.

"Specifically, the group's net profit after tax for 2009 is expected to be between ?300 million and ?400 million. In particular, regarding the profitability of the new markets, the group expects a positive contribution from all the countries in which it operates, including Russia."

BoC said group maintained a satisfactory level of profitability despite the negative economic environment. Its focus on traditional banking business, "prudent credit policy and the risk management applied by the group, ensure that the group is effectively shielded from the current global financial crisis and enable it to generate satisfactory profitability".

MPB said the economic conditions in Greece and Cyprus, as well as internationally, during the first quarter of the year "were of the most adverse of recent years".

"Despite these conditions, the group achieved positive economic results and balance sheet growth, with total assets reaching ? 40.7 billion, an annual increase of 29 per cent," it said.

Commenting on first-quarter 2009 financial results, Efthimios Bouloutas, CEO of MPB said:

"Undoubtedly the Group's operating performance in the first quarter of 2009 reflects the repercussions of the crisis' climax, which was reached during the last two quarters of 2008. In view of the ongoing crisis and its severe impact on the operating environment, MPB's management feels fully satisfied with MPB's profitability for the quarter."

The past week has seen big profits taken on shares in Marfin Popular Bank (MPB) and Bank of Cyprus (BoC).

Shares in MPB and BoC closed at ?2.23 and ?4.05 respectively on Friday, May 15, the day when MIG announced its plan to restructure its banking group and move the its headquarters to Greece from Cyprus.

The news sparked significant trades in bank shares generally during the week beginning Monday, May 18, with MPB and BoC shares peaking at ?2.84 and ?4.75 respectively on May 20.

This triggered profit-taking in both shares in the following days, with MPB closing yesterday at ?2.43. BoC shares followed the same trend as MPB, but rallied further over the last two days, closing at ?4.64 yesterday, in anticipation of more promising first quarter results.

On Friday, May 22, Royal Bank of Scotland sold its 5.22 per cent holding of MPB shares to MPB's parent company Marfin Investment Group (MIG) for ?119.2 million. This represents a profit of ?22.6 million based on the previous Friday's closing share price.

While not a straight "buyback", this purchase by MIG further consolidates its hold on the Marfin banking group.

Ask and you shall receive via the web
By Alexia Saoulli
THE CHURCH of Cyprus yesterday launched its new and improved website which will allow readers to stay informed about everything and anything to do with the church.

The new website has a range of information from Archbishop Chrysostomos II's works, the Holy Synod, the Archbishopric, the metropolises and bishoprics, monasteries and parishes.

Speaking to newsmen Chorbishop Gregorios of Mesaoria said the primary aim had been to enrich the old website, which had been a pioneer for its time.

"The website is for everyone, but it is mainly directed at young people," he said.

The Chorbishop said eventually the website hoped to host the name and location of every parish church, as well as the name of its priest, his phone number and email so that churchgoers could have direct contact to him.

"The website will provide material, but not the phone or a website can replace the personal communication with the priest, or the personal communication and relationship with the Church, the mysteries of the Church and so on," he said.

The website is available in both Greek and English, although the English section is seriously lacking as the information posted under the English subheads is in Greek.

The website also offers an option to sign up for an email newsletter and browsers can view the annual Church calendar at their leisure, as well as other useful information about weddings and the ecclesiastical charter.

Christos Spyrou, head of Ultima Communications which created the website said it had been presented as a page out of a book to achieve a connection to orthodox tradition.

According to Kykkos B' Lyceum student Marios Michael the website was interesting, up-to-date and reliable.

"The most important thing it offers us is communication. It gives us the ability to communicate with the Church of Cyprus, we can ask a question and send it through the internet," he said.

Head of LogosNet Yiannis Drakos since the website was first launched 16 months ago there was 43 per cent user increase.

He said among others users were from Cyprus, Greece, Russia, Great Britain, Poland, the United States, Germany and Turkey.

The website is available on: www.churchofcyprus.org.cy

Copyright © Cyprus Mail 2009

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