There were some encouraging signs in Attica’s Q221 results, with good momentum in core (interest and fees) revenue while impairments have now been at relatively low levels for two quarters after the balance sheet clean-up in recent years. The reported €4.4m loss reflects the fact that Attica needs to gain scale before it can be profitable. This requires more equity: Attica’s statutory CET1 is now only 3.1% (3.7% in Q121). Attica is pushing forward with its capital strategy. The deferred tax assets (DTA) to deferred tax credits (DTC) conversion has been activated, which will result in €151m (about 500bp of H121 risk-weighted assets, RWA) of equity being injected. Attica has also made progress on the securitisations front while shareholders have approved an equity raising of up €240m for this year. We suspended forecasts in July until further clarity on the outcome of these capital actions.
