* Komercni CEO expects H1 pft growth to be maintained in H2
* Sees loans growing 15 percent p.a. in medium-term
* Sees ROE to slow but remain above 20 percent
* Sees no liquidity constraints on Czech market
(Adds more comments)
By Jan Korselt and Jana Mlcochova
PRAGUE, Oct 2 (Reuters) - Czech lender Komercni Banka
<> expects profits to continue rising in the second
half despite an economic slowdown and the global financial
crisis, Chief Executive Laurent Goutard said on Thursday.
Goutard told Reuters in an interview he expected recurring
net profit to maintain the growth rate see in the first half.
"I am convinced that for the year 2008, we will be roughly
in line with the first half," Goutard said when asked about the
outlook for profit growth. "I do not see any real big signs of
any change today."
Recurring net profit at Komercni, majority-owned by Societe
Generale <SOGN.PA>, rose 23 percent in the first half to 6.26
billion crowns ($355.3 million).
But Goutard said the third largest Czech bank's loan
portfolio growth will probably slow to 15 percent annually in
the medium term from 24 percent in the first half.
Return on equity (ROE), a measure of profitability, will
drop but stay above 20 percent in the medium term, he said.
"Concerning return on equity, we have today 26 percent. It's
a very high level," Goutard said. "The target is to stay above
20 percent (in the medium term)."
NO CASH CONSTRAINTS
Goutard said he saw no constraints coming from the global
market turbulence on the Czech market, which he said had a
surplus of liquidity.
"I don't see a risk of liquidity for a very basic reason:
it's the fact that the main banks (here) are over-liquid,"
Goutard said.
Czech banks, like their peers around central Europe, do not
have heavy exposure to risky mortgage-backed assets.
Goutard said he expected the financial crisis would have
negligible impact on the Czech market which has a strong deposit
base.
"I was confident one year ago with the business model of
Komercni Banka, today I am even more confident because clearly,
and this is my strong conviction, this model is and will be the
winner of the crisis," he said.
Czech central bank chief Zdenek Tuma said on Thursday he
could not imagine any solvency problems in the financial sector
because the balance sheets of banks were healthy.
Profits at Czech banks grew at double digit rates in past
years, propped up by fast economic growth, but Goutard said he
expected the central European economy to slow in reaction to the
cooling euro zone.
He estimated growth to slow to around 3.5 percent in the
next two years from last year's 6.6 percent, in line with the
central bank's outlook.
"When you compare that with the forecasts for western
European countries, where clearly we are in recession, my
conviction is that there will be a slowdown in the Czech
economy, but at the end of the day it will not be a catastrophe
for the country, because I think the fundamentals are good,"
Goutard said.
Komercni shares have lost 8.3 percent since the beginning of
the year, outperforming peer Erste Bank <> whose shares
plunged 34.6 percent, and Prague's main PX index <> which
fell 32.6 percent.
Komercni trades at 12.5 times forecast earnings, above
parent Societe which trades at a 9.8 multiple while Erste trades
at 5.5 times forecast earnings.
(Editing by Quentin Bryar, Elaine Hardcastle)
