* H1 net profit 640 mln euros vs 422 mln year ago
* Provisioning charges in Austria, CEE fall 21 pct
* CFO - provisioning "bit better" than expected run rate
* Core Tier 1 ratio steady at 10.02 pct
* Impairment at Russian unit reflects securities strategy
(Recasts with comments from news conference)
VIENNA, Aug 4 UniCredit unit Bank Austria sees room to lower bad debt charges if the economy holds up, emerging Europe's leading lender said after a sharp fall in provisioning helped net profit rise more than half.
"The cost of risk is starting to get into a positive area but we may still have potential for further improvement provided the economic environment stays relatively benign, especially in CEE," finance chief Francesco Giordano told a news conference.
Banking in central and eastern Europe (CEE) generates two-thirds of Bank Austria's net operating profit and should remain a growth driver as the region's rebounding economy outpaces expansion in sluggish western Europe, it says.
Profit before tax in its CEE banking operations rose 34 percent in the first half.
Provisioning costs fell 21 percent in the first half, including a 28 percent drop in Austria's robust economy and 19 percent in CEE, Bank Austria said on Thursday.
Harmonisation of accounting standards in some CEE countries helped a bit on this front, Giordano said, adding: "The quarterly rate is indeed a little bit better than we can expect as a run rate, but this of course doesn't cancel the general consideration that there is a very strong improving trend."
Solid commercial lending in the half also helped offset a one-off hit to net profit of 100 million euros ($142.5 million) from writing down Greek government bonds as its contribution to a rescue package for the highly indebted euro zone country.
It also took a 53 million euro impairment charge, mainly for goodwill at its Russian unit CJSC UniCredit Securities, formerly known as ATON.
Giordano said this reflected a more cautious view of the earnings potential from its securities business in Russia.
"While we are extremely committed to Russia as you know, we would also consider that we would like to do securities business mostly in support of corporate and maybe less as standalone activity," he said.
Citing a nearly unchanged core Tier One ratio of just over 10 percent of risk-weighted assets, Giordano said the bank was well placed to meet Basel III capital adequacy rules.
Chief Executive Willibald Cernko said the bank was not seeing a rise in default rates on its Swiss franc loans to borrowers -- many of whom borrowed at low rates to finance their homes -- despite the franc's strength.
In Austria 250,000 households have Swiss franc loans, of which 60,000 are at Bank Austria, he said.
"The customers are paying. They are fulfilling their obligations. On the other hand we want to provide offers to get out of this difficult situation," he said, adding 300 to 400 staff in Austria were dealing solely with this issue.
UniCredit, Italy's biggest bank, easily beat second-quarter profit forecasts on Wednesday, as trading results helped offset the impact of the euro zone's debt crisis.
Big Austrian banks are the largest lenders in central and eastern Europe. They include Bank Austria, Erste Group Bank and Raiffeisen Bank International .
Erste Group lowered its full-year outlook last week as bad loans remained high in Hungary and Romania and as lending growth stagnated. (Editing by Greg Mahlich and Jane Merriman)