Raiffeisen Bank International (RBI), the second largest bank operating across Central and Eastern Europe by assets, reported that net profit almost doubled year-on-year to €220mn in the first quarter as its Russian business started to bounce back.

The better than expected result was helped by a 4.7% y/y rise in net interest income, boosted by the impact of the appreciating ruble on its Russian business, and a 24% fall in provisioning costs for impairments, as RBI’s markets, particularly Russia, continue their recovery. The average prediction of a Reuters poll of analysts had been for net profit of €151mn.

RBI shares slipped by 0.18% on May 17 but have soared by 95% over the past 12 months to €22.07.

“We are very satisfied with the start into the financial year 2017,” said Johann Strobl, the incoming CEO. “We see a very positive economic development in almost all our markets and want to make use of this development for selective growth.”

In Russia, its biggest market, non-performing loans shrank by 3.8 percentage points y/y to 5.6%. RBI said it had reduced its risk-weighted assets there to the desired level and was now looking to grow assets in selected areas.

That RBI is starting to talk about growth demonstrates the progress it has made since it launched a restructuring programme in early 2015 after making its first ever full-year loss in 2014 and coming under strong pressure from regulators and investors to boost its capital strength to the level of its peers. Over the past two years it has withheld dividends and devoted all profits to equity, made several disposals, and restricted lending in risker markets such as Russia.

Profitability has improved significantly, with consolidated return on equity of 9.6% in the first quarter, compared with an average of 6.2% last year. RBI has a medium-term ROE target of 11%.

Its fully loaded Tier 1 capital adequacy – a key measure of capital strength – fell 20 basis points compared to the previous quarter to 12.2% following RBI’s merger with its unlisted Austrian parent RZB, which took effect in January. Including the first-quarter results, the ratio would be 12.6%. RBI has a medium-term target to raise its CET1 ratio to 13%.