Bloomberg News

Erste May Report 1.4 Billion-Euro Third-Quarter Loss on Charges

October 27, 2011

Oct. 27 (Bloomberg) -- Erste Group Bank AG, eastern Europe’s second-biggest lender, may say its underlying business shrunk in the third quarter, exacerbating the loss caused by writedowns and charges it announced two weeks ago.

Erste probably swung to a net loss of 1.42 billion euros ($2 billion), compared with net income of 265 million euros a year earlier, according to the average estimate of nine analysts surveyed by Bloomberg. The Vienna-based bank is due to report results tomorrow at 7:30 a.m.

That is in line with the 1.45 billion-euro loss Erste announced Oct. 10, when it unveiled writedowns and extra loan- loss charges at its Hungarian and Romanian units and losses due to a reclassification of credit default swaps.

In addition to those extraordinary writedowns, Erste’s regular business probably weakened as well, according to the survey. Net interest income, Erste’s biggest revenue source, may have dropped 2 percent from a year earlier to 1.36 billion euros as credit growth remained subdued in eastern Europe. Fee and commission income probably shrunk by the same rate.

The following is a table of analyst estimates and results from the previous and year-earlier quarters. The figures are in millions of euros.

The following banks participated in the survey: Berenberg Bank, Citigroup, Concorde Securities, Deutsche Bank, Exane BNP Paribas, HSBC, J&T Banka, JPMorgan, Kepler Capital Markets, RCB, UBS, UniCredit, Wood & Co.

--With assistance from Thomas Mathews in London. Editors: Steve Bailey, Dylan Griffiths

To contact the reporter on this story: Boris Groendahl in Vienna at bgroendahl@bloomberg.net

To contact the editor responsible for this story: Angela Cullen at acullen8@bloomberg.net


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