Banesto, the Spanish domestic bank controlled by international group Santander, on Wednesday reported a 6.8 per cent fall in net attributable profit to €381.7m in the first half of the year, compared with €409.5m in the same period of 2009.
Gross profit was steady at €1.29bn, against €1.28bn a year previously. The contribution from net interest income rose 0.5 per cent to €863.6m from €859.2m.
But the bank followed previous practice in making a voluntary €104m generic provision against bad loans in the first half. Net extraordinary provisions were €84.8m in the six months to June, compared with €53.9m at the same time last year.
Banesto’s figures, which it described on Wednesday as “quality results”, are closely watched in the markets as it is the first listed Spanish bank to report – although the quarterly net profits can be hard to interpret because of large changes in special provisions.
In common with other European banks, Banesto has been seeking to reinforce its capital position during the crisis. It said its tier one capital ratio had reached 8.99 per cent of risk-weighted assets, up from 8.25 per cent a year earlier.
Banesto’s return on equity dropped to 9.72 per cent from 14.7 per cent, and its return on assets to 0.48 per cent from 0.65 per cent.
In the quarter to June, net attributable profit was €170.2m, down from €198.7m a year earlier and €211.5m in the previous quarter ending in March 2010. The results were slightly better than analysts had expected.
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