HVB Group, UniCredit SpA (UCG)’s German banking unit, said first-quarter profit rose 7.2 percent, helped by higher income from trading and after it set aside less money for risky loans.
Net income advanced to 730 million euros ($943 million) from 681 million euros a year earlier, the Munich-based lender said in an e-mailed statement today.
HVB reduced its loan-loss provisions by 29 percent to 90 million euros. Net trading income rose 57 percent to 807 million euros, while the lender’s core Tier 1 capital ratio, in accordance with Basel II rules, climbed to 15.7 percent at the end of the quarter from 15.6 percent at the end of last year.
HVB, led by Chief Executive Officer Theodor Weimer, announced plans last year to eliminate more jobs to reduce administrative costs. Milan-based UniCredit, Italy’s biggest bank, said yesterday that profit rose 13 percent to 914 million euros as higher trading income related to the buyback of its securities offset a drop in fees and lending.
UniCredit CEO Federico Ghizzoni is cutting costs and reviewing the bank’s strategy in central and eastern Europe as part of a plan approved in November to strengthen finances and boost profit. The lender raised 7.5 billion euros in a rights offer in January to meet capital targets set by the European Banking Authority.
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