Bank Austria boosts Q1 profit as loan writedowns fall

VIENNA Tue May 13, 2014 2:34am EDT

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VIENNA May 13 (Reuters) - UniCredit unit Bank Austria boosted first-quarter profit by a quarter to 350 million euros ($481 million) as loan writedowns fell, especially at its core business in central and eastern Europe (CEE).

Bank Austria, CEE's leading lender, said it was cautiously optimistic on the economic outlook for the rest of 2014.

"Recovery should continue and credit demand should rise if the current geopolitical tensions can be resolved peacefully," Chief Executive Willibald Cernko said in a statement on Tuesday.

Parent UniCredit returned to profit in the first quarter and said on Monday bad loans had fallen for the first time since 2008 as the Italian economy showed signs of recovery.

($1 = 0.7270 Euros) (Reporting by Michael Shields; Editing by Georgina Prodhan)