ATHENS (Reuters) - Greece's third-largest lender Eurobank <EURBr.AT> more than doubled its first-quarter net profit on the back of lower provisions for impaired loans and higher fee and commission income, it said on Friday.
Eurobank, which is 2.4% owned by the country's HFSF bank rescue fund, reported net earnings of 57 million euros, up from 22 million euros in last year's first quarter.
The coronavirus pandemic struck just as Greece's banks were making headway in their bid to sell, write off or restructure billions of euros of bad debt accumulated during the last financial crisis.
Eurobank said credit loss provisions dropped 23.4% year-on-year to 126 million euros, while non-performing exposures (NPEs) eased to 28.9% of its loan book from 29.2% at the end of December.
The bank is nearing completion of a deal to sell an 80% stake in its FPS loan collection subsidiary to Italy's top debt recovery firm doValue <DOVA.MI>.
"All outstanding matters have been concluded and we expect the formal closing in the first half of June," the bank's Chief Executive Fokion Karavias said. "As a result, Eurobank will have the lowest NPE ratio in Greece at 15.6%."
Greece's economy is seen contracting by 6% this year under the central bank's baseline scenario, hit by restrictive measures to slow the spread of the virus, the global recession and an expected sharp drop in tourism.
"After a period of turmoil, economic activity should start to normalize and our de-risked balance sheet post the Cairo transaction will be the base for above-par profitability for Eurobank," Karavias said.
(Reporting by George Georgiopoulos; Editing by Jan Harvey)