Zagreb Bank achieved a net profit of 394 million kuna in the first half of this year, which is 32.3 percent less than in the same period last year, the bank announced via the Zagreb Stock Exchange.
“The achieved result continues to be influenced by reduced demand for loans, lower interest income, still relatively high financing costs, and increased provisioning costs,” stated Zagreb Bank.
According to the report, Zagreb Bank’s operating income in the first half amounted to 1.8 billion kuna, which is a decrease of 10 percent, or 204 million kuna, compared to the same period last year.
This was primarily influenced by a decline in net interest income, which amounted to 1.2 billion kuna, a decrease of 216 million kuna, or 15.2 percent compared to the first half of last year.
Net income from fees and commissions amounts to 403 million kuna, a decrease of 2.2 percent, while a 10.3 percent increase was recorded in net trading income and other revenues, which amounted to 224 million kuna.
Total operating expenses of Zagreb Bank in the first six months amount to 833 million kuna, which is a decrease of 54 million kuna, or 6.1 percent, compared to the same period last year.
Profit from operations before value adjustments and provisions for losses amounts to 997 million kuna, which is 150 million kuna, or 13.1 percent less than in the same period of the previous year.
In the first six months, Zagreb Bank allocated 521 million kuna for value adjustments and provisions for losses, which is an increase of 20.3 percent, or 88 million kuna, year-on-year. The increased costs of value adjustments are a result of the recessionary environment due to high unemployment rates, low levels of investment activity, and a decline in disposable income and profits in the real sector, the report states.
