Euroinvestment: Profit warning 2003
10/2/2004 10:20
Pursuant to the relevant CSE and SEC regulations, Euroinvestment & Finance Ltd announces that, based on the preliminary indications from the annual review of the Company's loan portfolio and within the framework of the new stricter regulations imposed by the Central Bank of Cyprus regarding the non-serviced loans, the Company's bad debts provisions for 2003 (including provisions for the suspension of the recognition of interest on non-serviced loans and general provisions) will be significantly higher compared to 2002. Despite the gradual increase and stable improvement in the volume of loans that are being serviced again, the process of bringing the accounts back to normal is long, due to the ongoing uncertainty on the institutional intervention on investment loans.
The results after taxation for 2003 will, show a significant increase in losses due to increased provisions. Results before the recognition of interest suspensions and provisions are expected to show increased profitability, mostly due to the improvement in the results from investments and the costs' management.
It is noted that the provisions are reserves and not amounts to be written off, whereas the capital base of the Company even following the increased provisions, remains at satisfactory levels with the Capital Adequacy Index being calculated at 14% as at December 31, 2003 compared to a 10% minimum requirement set by the Central Bank and an 8% based on the EU directives.
The results after taxation for 2003 will, show a significant increase in losses due to increased provisions. Results before the recognition of interest suspensions and provisions are expected to show increased profitability, mostly due to the improvement in the results from investments and the costs' management.
It is noted that the provisions are reserves and not amounts to be written off, whereas the capital base of the Company even following the increased provisions, remains at satisfactory levels with the Capital Adequacy Index being calculated at 14% as at December 31, 2003 compared to a 10% minimum requirement set by the Central Bank and an 8% based on the EU directives.
