May 6, 2020 / 4:38 PM / 20 days ago

Italy's BPER posts sharp drop in profit on additional virus provisions

MILANO, May 6 (Reuters) - Italy’s sixth-largest lender, BPER Banca, on Wednesday posted an 87% drop in first-quarter profit after further loan writedowns to offset the impact of the COVID-19 pandemic.

BPER reported a net profit of 6.1 million euros ($6.6 million) for the first quarter compared with 48 million euros a year earlier and a net loss of 143.3 million euro in the fourth quarter of last year which was impacted by one-off charges.

The bank wrote down problem loans by 139.6 million euros, including 50 million euros of additional provisions to tackle the risks related to the coronavirus outbreak which is set to plunge Italy’s already fragile economy into its worst recession since World War Two.

BPER’s first-quarter revenues came in at 596.6 million euros, up 20.4% from a year earlier, but down some 5.6% from the previous quarter, hurt by a sharp drop in trading income amid the market turmoil.

The bank said its core capital ratio remained stable at 12%.

It added that given the difficult and unprecedented health emergency it was hard to predict how its economic and capital situation would evolve this year. ($1 = 0.9261 euros) (Reporting by Andrea Mandalà; editing by Jonathan Oatis)

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