Bank Austria Creditanstalt (BACA) says it had a good first half. Net income after taxes and minority interests was up by 39.9 per cent to EUR 283 million (first half of 2003: EUR 202 million). The return on equity use from 8.8 per cent to 9.4 per cent, although the equity base increased by 30 per cent.
“Our results for the first half of 2004 show that we are on track,” says Erich Hampel, CEO of Bank Austria Creditanstalt. “Business development in Central and Eastern Europe is particularly satisfactory. In this region we are reaping the benefits of our strategy of expansion.”
Net income before taxes generated by the CEE business segment rose by 87 per cent to EUR 169.1 million. The CEE business segment accounts for 41 per cent of BA-CA’s net income before taxes, thus making the largest contribution to Group profits. Business volume measured by total assets in the region also increased strongly, by 16 per cent to EUR 25.1 billion. The BA-CA network in the region comprises some 870 offices in 11 countries. Moreover, through HVB Group, customers of Bank Austria Creditanstalt have access to markets in Russia, Ukraine, the Baltic states and all international financial centres.
“We aim to pursue strong growth in CEE by expanding existing units particularly in the coming years,” says Hampel. “We will open about 200 new branches by 2007. And we take a look at opportunities for further acquisitions. In this context, one thing is clear: an acquisition must make financial sense.”
With shareholders’ equity in accordance with IAS of over EUR 6 billion, Bank Austria Creditanstalt believes it has a sufficiently strong capital base for further expansion in CEE.
Business in Austria was also satisfactory. “Our customer-focused market initiative is proving effective,” says Hampel. “Our employees are making strong efforts in this respect. We are moving in the right direction in Austria. But we should not have any illusions. There is still a lot of work ahead of us: to ensure that the favourable development will continue in the future, we will have to further improve the cost structure.”
The Bank Austria Creditanstalt share price has responded well. Since 9 July 2003 – the first day of trading in BA-CA shares on the Vienna Stock Exchange after the flotation of a 25% stake by HVB – it has risen by 72 per cent.