He also said the Austrian lender intended
eventually to boost its dividend payouts back to levels of the
boom years before the financial crisis, although he gave no
clear indication of how long it would take for this to happen.
Treichl reiterated Erste's 2014 forecast for steady operating
profit and stable lending while risk costs - impairment charges
and provisions for bad loans - fall as much as 5 percent.
It was too early to give an outlook for 2015, he said at the
annual shareholders meeting, but added: "When many things are
cleared up there is certainly a chance that 2015 will look
significantly better than 2014. We will get the answers only in
six months, and we don't want to make any clear comments until
By then major banks in the euro zone will have gone through a
health check of their balance sheets, a process that Treichl
complained seemed slanted against lenders like Erste, the
third-biggest lender in central and eastern Europe.
He questioned, for instance, why supervisors assumed for its
stress test scenario that the economies of core CEE countries
would contract a cumulative 5 percent on average from 2014 to
2016, more than in countries like Greece or Italy.
The assumption would be the subject of intense discussions in
the weeks ahead, he said.
Sluggish consumer and investment demand from Erste's core
clients in the region prompted its subdued outlook for 2014 and
made it hard for Erste to earn its cost of capital, a short-term
goal that Treichl said would not be met this year.
Shareholders were voting on Erste' proposed halving of its
dividend to 0.20 euros per share, but Treichl held out prospects
for clearly better payouts in the years ahead.
"We no longer have to plan giant expansion. We are in the region
we want to be in," he said while repeating Erste's mid-term
strategy to establish itself in Poland. "I don't know if this
will happen or 2018 or 2020 or earlier," he said.
Erste paid a peak dividend of 0.75 euro for its 2007 business
(Reporting by Michael Shields; Editing by Pravin Char)
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