UPDATE 1-Bank of Cyprus says Q1 net profit down 46 pct

* Group Q1 net profit falls 46 percent

* Says maintains full-year profit guidance

* Q1 net interest income falls 2 percent (Adds further details)

By Michele Kambas

NICOSIA, May 28 (Reuters) - Bank of Cyprus BOC.CY (BOCr.AT) saw a 46 percent drop in its first-quarter group net profit to 63 million euros ($87 million), it said on Thursday.

Net interest income declined 2 percent to 181 million euros while pre-tax profit fell 41 percent to 79 million euros.

The bank increased its provisioning by 138 percent and there was a 32 percent increase in staff costs due to the expansion of operations in Greece, Russia, Romania and Ukraine.

Bank of Cyprus is predominantly active in Cyprus and in Greece. In Cyprus, where it is the island's largest bank, it said there was a 37 percent drop in net profit to 55 million euros, while there was a 69 percent decline in net profit in Greece, to 7 million euros.

The bank said it maintained its 2009 forecast of a net profit of between 300 and 400 million euros. There had, it said, been an improvement in the deposit and lending spreads in April and May of this year. It posted a net profit of 502 million euros in 2008.

It said it expected a positive contribution this year from all of the countries where it had operations, including Russia, where it acquired a majority stake in a commercial bank in mid-2008. ($1=.7207 euros) (Editing by Greg Mahlich) ((michele.kambas@thomsonreuters.com; 357 22469607; Reuters messaging michele.kambas.reuters.com@reuters.net))