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Erste Group expects Q2 profit of about €560M

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Erste Group expects Q2 profit of about €560M

Erste Group BankAG expects to report a second-quarter net profit of approximately €560million, resulting in total net profit of about €830 million for the first half.

The expected second-quarter profit is attributable to the releaseof about €30 million in risk provisions in Hungary and Romania, as well as decliningrisk costs in other geographies. Erste also booked a one-off gain of €139 millionfrom Visa Inc.'s of Visa Europe.

The bank added that it also saw "significantly improved"operating and other operating results compared to the first quarter.

Given the year-to-date performance, Erste Group revised its projectedreturn on tangible equity for full year 2016 to greater than 12% from a previousrange of 10% to 11%. The guidance includes a buffer for a potential banking taxone-off payment in Austria in 2016, after the Austrian government agreed to the country's annual banktax from 2017.

Erste Group will report its second-quarter results Aug. 5.