To the press releases overview

“Erste Group’s performance in the first six months of this year has been one of the best ever -- our net profit rose by 24 percent year-on-year to 774 million euros. This was driven by an increase of 3.3 percent in net interest income and 5.3 percent in fees income, risk costs remaining at low levels and the cost/income ratio dropping from 64.3 percent to 58.8 percent in the second quarter.

We expect this positive trend in our operating performance to continue in the second half of 2018, based on the persisting outperformance of CEE economies, with low unemployment rates, rising real wages and increasing economic competitiveness,” said Andreas Treichl, CEO of Erste Group Bank AG.

“Erste Group’s performance in the first six months of this year has been one of the best ever -- our net profit rose by 24 percent year-on-year to 774 million euros. This was driven by an increase of 3.3 percent in net interest income and 5.3 percent in fees income, risk costs remaining at low levels and the cost/income ratio dropping from 64.3 percent to 58.8 percent in the second quarter.

We expect this positive trend in our operating performance to continue in the second half of 2018, based on the persisting outperformance of CEE economies, with low unemployment rates, rising real wages and increasing economic competitiveness,” said Andreas Treichl, CEO of Erste Group Bank AG.

OUTLOOK

Operating environment anticipated to be conducive to credit expansion. Real GDP growth is expected to be approximately between 3% and 4% in Erste Group’s CEE core markets, including Austria, in 2018. It should primarily be driven by solid domestic demand, as real wage growth and declining unemployment should support economic activity in CEE. Fiscal discipline is expected to be maintained across CEE.

Business outlook. Erste Group aims to achieve a return on tangible equity (ROTE) of more than 10% in 2018 (based on average tangible equity in 2018). The underlying assumptions are slightly growing revenues (assuming 5%+ net loan growth and interest rate hikes in the Czech Republic and Romania), slightly falling expenses due to lower project-related costs and risk costs remaining at historically low levels.

Risks to guidance. Impact from other than expected interest rate development; political or regulatory measures against banks; and geopolitical risks and global economic risks.