• Net interest income up 27.1 % year-on-year to EUR 1.77 bn
• Operating result at EUR 1.26 bn, up 56.9 % year-on-year
• NPL ratio at 2.1 %; net release of EUR 20.7 mn risk provisions in Q1
• Rise in customer deposits outpaces lending volume growth 

Erste Group Bank AG reported an operating result of 1.26 billion euros for the first three months of 2023. This year-on-year rise of nearly 57 % reflected solid net interest income of 1.77 billion euros (up 27.1 % y/y) on the back of generally favorable interest rate developments and a larger customer loan volume. Gains in payment services and in asset management led to a 4.4 % y/y rise in net fee and commission income to 643 million euros. Valuation effects saw the net trading result improve to 117 million euros compared to a loss of 257 million euros during the same period a year earlier. Operating expenses were 0.6 % higher y/y at 1.24 billion euros. The first quarter saw a net release of risk provisions leading to a positive impairment result of 20.7 million euros, which contributed to a net result of 594 million euros for the quarter.

“The economies in Central and Eastern Europe have not escaped the global slowdown in economic growth, but they are proving to be resilient. We’re confident that CEE’s convergence story remains intact and that the region will once again stand out as the growth region within Europe as of 2024,” said Erste Group CEO Willi Cernko. “In addition to that confidence, we also have a very clear vision for digitalization. We’ve already shown that with the success of George for our retail customers across six markets. Now, we’ve launched George Business for corporate users in Austria and will expand this innovative business banking platform to our other markets too. We’ll continue to drive digital innovation as a key means of providing our customers with the data, tools, and knowledge they need to advance their financial well-being.”

“Lending growth slowed in the first quarter, reflecting the more muted overall macro environment. However, net interest income grew strongly and remained the key revenue driver, NII grew on the back of favorable rate cycles in most of the markets and higher customer loan volumes in all of them. Our bottom line in the first three months of 2023 also benefitted from operating expenses that were in line with expectations and from a risk environment that remained benign,” said Stefan Dörfler, Erste Group’s CFO. “Given recent developments in the global banking market, we welcome the deposit inflows we had in recent months. They are a sign of the trust that customers place in us as a stable leader in the CEE region. The solid operating and bottom line results we posted in the first quarter also provide us with confidence that we’re well underway to meet our upgraded full-year guidance.”