BACB Q3’18 net profit rises 135% YoY on NII improvement and lower provisioning (POSITIVE)

Q3’18 consolidated net interest income surged 28.1% YoY on both 14.6% growth of interest income and 24.2% decline of interest cost. Gross loan book was up 15.4% YoY and 5.5% for the quarter, while customer deposits grew 15.8% YoY. Non-interest income was nearly flat on annual basis and TOI reached BGN 11m, +23.2% YoY. The growth of administrative expenses for the quarter was fully offset by the lower credit provisioning charges and net profit came to BGN 3.7m (EPS of BGN 0.15), +135% YoY. Similar dynamics were shown for the 9m’18 results with net interest income up 23.2% YoY, TOI up 19.1% and net profit growth of 67.8% YoY to BGN 10.3m (EPS of 0.42). The 90+days NPL ratio was up to 18.7% compared to 17.9% at end-2017, while coverage decreased to 65.8% from 72.7% in Dec-2017, despite the BGN 5.2m additional provisions from IFRS 9. CAR was down by 1.54 p.p. YtD to 17.13% mainly due to the assets growth.