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Erste Group Bank AG (EBKOF) CEO Bernd Spalt on Q4 2019 Results - Earnings Call Transcript

Mar. 03, 2020 5:20 PM ETErste Group Bank AG (EBKOF), EBKDY
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Erste Group Bank AG (OTCPK:EBKOF) Q4 2019 Earnings Conference Call February 28, 2020 4:00 AM ET

Company Participants

Bernd Spalt - CEO, Erste Group

Alexandra Habeler-Drabek - CRO, Erste Group

Stefan Dörfler - CFO, Erste Group

Conference Call Participants

Gabor Kemeny - Autonomous

Andrea Vercellone - Exane

Anna Marshall - Goldman Sachs

Johannes Thormann - HSBC

Tobias Lukesch - Kepler Cheuvreux

Alan Webborn - Societe Generale

Stefan Maxian - RCB

Hadrien De Belle - KBW

Bernd Spalt

Thank you very much. Good morning ladies and gentlemen. Let me start on Page number 4, the group income state performance and let me drive to the chart on the right-hand side on the year-on-year development. The year-on-year development shows a very good business model and very robust CEE economies. So what you see is an 8.7% in operating result performance. So, very good revenues, good cost management in this year, a very group strong negative result on the other operating results land, which then translates into a net profit of 1.47 at the end of the year.

If we go the Q-on-Q chart on the left hand side, we see the individual developments upon Q4. Expense side have a usual shown some seasonal up drift on the back of IT exchanges and marketing, and PEREX going up slightly. We have booked 17 basis points of risk costs in the fourth quarter, which on an annual basis translate into 7 base points risk costs.

So, we're still seeing a very benign risk environment, and we see the other reside, very much interested by the increase or the doubling of the slow back banking tax. We've been announcing that on the Capital Markets Day, last year, when we set that probability that in the context of the increase of the banking tax, an impairment of goodwill will be necessarily what you

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