Raiffeisen Bank International, Austria's third-biggest bank, said souring corporate credit in Austria and an asset-quality review in Slovenia will cause loan losses to rise as much as 20 per cent this year.

The shares fell 4 per cent to €24.57. Raiffeisen, also the second-biggest lender in eastern Europe after UniCredit, sees loan-loss provisions of as much as €1.2 billion this year, it said in a statement, scrapping its goal, last reiterated on August 22nd, that charges will remain little changed from last year's €1.009 billion.

Bad debt in Hungary, Ukraine and the former Yugoslavia, and a rising number of insolvencies and restructurings in Austria, already forced Raiffeisen to book its first quarterly loss last year. The increase in loan losses means earnings per share will be 22 per cent lower than estimated. – (Bloomberg)