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Feb. 26, 2021, 2:02 a.m. EST

Erste Group profit nearly halves on provisions

By Joshua Kirby

Erste Group Bank AG said Friday that its net profit plunged in 2020, largely as a result of increased provisions relating to the coronavirus pandemic.

The Austrian bank's net profit for the year came to 783.1 million euros ($953.5 million), down from EUR1.47 billion in 2019. Risk provisions of close to EUR1.3 billion for loan losses in the aftermath of the pandemic hit the result, Erste Group said.

Net interest income was up slightly at EUR4.77 billion, while net fee and commission income slipped 1.2% to EUR1.98 billion. Operating income came to EUR7.16 billion, down from EUR7.23 billion previously.

In line with European Central Bank recommendations, the bank will propose a dividend of EUR0.50 a share for the year at the next general meeting, and will also reserve up to EUR1.00 a share for a future potential payout.

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