Vienna - Austria's Raiffeisen Zentralbank Group (RZB) on Friday reported 312 million euros (494 million dollars) in write-offs for the 2007 financial year as a result of the international financial crisis.

The losses were, however, cushioned by a strong performance of the bank's Central and Eastern European (CEE) subsidiaries.

"The valuation of securities and derivative financial instruments in the investment portfolio pursuant to IFRS (international financial reporting standards) resulted in a negative contribution of 312 million euros," the bank said.

Compared to other banks, RZB got off rather lightly, CEO Walther Rothensteiner said. Even if RZB was not hit full force by the storm on the financial markets, it did not survive unscathed, he added.

Profit after tax increased by 15 per cent to 1.19 billion euros, RZB said. Operating profits were up 24.3 per cent to 2 billion euros.

The balance sheet total was up 18.8 per cent to 137.4 billion euros, accompanied by a 35.2-per-cent increase in equity to
10.3 billion euros.

The cost/income ratio, however, was down by 0.2 per cent to 56.9 per cent and return on equity was down 4.5 per cent to
22.2 per cent.

RZB's potential hard landing was cushioned by the strong performance of Raiffeisen International, a subsidiary focusing on CEE business.

In results released separately in March, Raiffeisen International said it boosted fourth-quarter earnings by 38 per cent on high demand for retail banking in Eastern Europe and the former Soviet Union with net income rising to 216 million euros.

Consolidated profit after tax and minorities improved by 41.7 per cent to 841 million euros for the full year.

RZB reported strong growth in both corporate and retail banking, especially in the CEE region. Austria's third largest bank also increased its market share at home by 0.9 per cent to 15.3 per cent.

RZB expected difficult market conditions to continue well into 2008. (dpa)