Raiffeisen Bank International (RBI) reported in the first quarter of 2024 that its Group result rose by one percent to €664 million. This was a positive development, especially considering the fact that excluding contributions from Russia and Belarus, the consolidated result was €333 million. In addition, the cost of risk fell by more than 90 percent compared to the same period last year, which CEO Johan Strobl stated was encouraging.
The bank’s net interest income increased by €70 million to €1.45 billion in the first quarter of 2024. This was primarily driven by higher interest income in Central and Southeastern Europe, with Slovakia recording the highest growth at €25 million. However, net income from commissions fell by €297 million to €669 million, with Russia recording the biggest decline.
Losses based on the impairment of financial assets amounted to €25 million in the first quarter of 2024, which is significantly less than last year’s amount of €301 million. Net impairment losses were recognized for overdue loans and were largest for non-financial companies and households. Looking ahead to the full year, RBI expects net interest income to be around €4.0 billion and net commission income to be around €1.8 billion. Trade receivables are expected to grow by 3-4%, with administrative costs estimated at €3.3 billion, leading to a cost-to-income ratio of around 52%.
In terms of returns on equity, RBI expects a group return on equity of around 10% in 2024, with a Tier 1 ratio of around 14.6% at the end of the year assuming deconsolidation of its Russian unit at a price-to-book ratio of zero. The decision on dividends will depend on RBI’s capital position as well as other factors such as regulatory requirements and market conditions.
Overall, RBI’s performance in Q1 has been strong despite challenges faced globally due to economic uncertainty and geopolitical tensions