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Alpha Bank swings to FY'16 profit as impairments drop YOY

Alpha Bank AE reported a fourth-quarter 2016 profit attributable to shareholders of €20.1 million, down from a restated €41.2 million in the previous quarter.

Net interest income for the quarter came in at €490.1 million, up from €481.2 million in the previous quarter. Net fee and commission income amounted to €81.2 million, compared to €81.1 million in the third quarter of 2016.

Fourth-quarter 2016 extraordinary costs came in at €66.9 million, compared to a gain of €200,000 in the previous quarter. The bank noted that it booked an impairment on fixed assets of €47 million during the fourth quarter.

Impairment losses on credit risk widened quarter over quarter to €303.9 million from €258.2 million.

The bank said nonperforming loans in the fourth quarter of 2016 decreased by €225 million, adjusted for the sale of its Serbian subsidiary, against new NPLs of €77 million in the previous quarter. The bank's NPL ratio stood at 38.1% as of Dec. 31, 2016, compared to 38.3% three months earlier. In its Greek business, the NPL ratio was 38.0%, down 30 basis points from three months earlier.

Nonperforming exposures, a European measure of bad and restructured debt, represented 53.7% of total loans at year-end, up from 53.2% three months earlier.

For the full year 2016, Alpha Bank posted profit attributable to shareholders of €42.3 million, compared to a restated year-ago loss of €1.37 billion. Net interest income for the year amounted to €1.92 billion, compared to €1.90 billion in 2015, while net fee and commission income increased year over year to €317.9 million from €308.6 million.

Full-year 2016 extraordinary costs amounted to €111.2 million, compared to €123.4 million in 2015. Impairment losses on credit risk for full-year 2016 totaled €1.17 billion, compared to €2.99 billion in 2015.

At 2016-end, the bank's common equity Tier 1 ratio was 17.1%, up from 16.8% at the end of September 2016 and 16.6% at the end of 2015. The ratio stood at 17.3% pro forma for the sale of its Serbian operations, agreed upon in late January.

The bank's fully loaded Basel III CET1 ratio stood at 16.7%, or 17.0% when adjusted for the Serbian sale.