The global banking sector is experiencing the biggest turmoil since 2008 in the aftermath of last month's collapse of Silicon Valley Bank in the United States and the forced merger between Swiss banks UBS and Credit Suisse. Bourke told Reuters "volatility will mean that markets in the short term are going to be very unreceptive for all sorts of market instruments or IPOs, but that will die down, as it always does." He said an initial public offering remains "the central scenario". "What we are effectively building is an investable bank. Markets in the short term are extremely volatile, but we don’t deviate for a second from our plans and will see how markets are when they open up, be that in 2024 or thereafter," he said. Net interest income (NII) - earnings on loans minus costs on deposits - jumped 84.5% year-on-year to 246.3 million euros. Bourke said the bank was "delivering consistent growth, increasing profitability and exceeding expectations", highlighting "evident progress" as the fully loaded Common Equity Tier 1 solvency ratio improved to 14.1% in March, from 13.1% at end-2022. Non-performing loans (NPL) dropped to 1.29 billion euros, or 4.4% of total loans, in March from 5.7% a year earlier. In 2017, when Lone Star acquired control, the share of bad loans was 28%. Portugal's Resolution Fund and the state have the remaining 25% stake in the bank. "NPL creation in the quarter was only about 30 million euros, that is one-third of what we have expected. We are not seeing strain in either mortgage or corporate books," Bourke said.
($1 = 0.9087 euros) (Reporting by Sergio Goncalves Editing by Andrei Khalip and Susan Fenton)
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