BCR's restructuring costs totalled 13 million euros in the first quarter of this year, 9 million euros of which were used for a special risk reserve, according to the data revealed in Vienna by Erste Bank, BCR's majority shareholder.

A total of about 40 million euros was projected for restructuring this year, to be used for redundancy and early retirement payments, consulting services, marketing and IT, and did not include costs related to the re-evaluation of some loans.

The number of BCR employees went down 4.4% in three months to 12,896.

The 9 million-euro special risk reserve took the total risk reserves to 14.5 million euros, an increase of 65.8% from the first quarter of 2006.

At the same time, the total operating expenses amounted to 108.4 million euros in the first quarter, up 12% (11.6 million euros) compared with the same time last year, 4 million euros of which are restructuring expenses.

After deducting all the restructuring costs, 13 million euros, BCR posted a 62 million-euro net profit for the first quarter, an increase of 9.6% from the first quarter of 2006. The Austrians will get 44.3 million euros of it, which corresponds to their almost 70% stake in the bank.

"We expect the net profit of BCR to go up by about 40% this year, after deducting the restructuring costs," stated Andreas Treichl, the chief executive of Erste Bank and chairman of BCR's Supervisory Board. In 2006, BCR posted 214.5 million-euro net profit according to the international accounting standards, excluding the restructuring costs.

During the presentation of the first quarter results of BCR, Treichl explained that the narrowing of the interest margin that became obvious in the second half of 2006 continued to put pressure on revenues, affecting the comparison with the first quarter of last year. Net revenues from interests reached almost 12