Despite the unfavorable economic environment and contrary to the negative trend in the profitability of the overall banking system, OTP Bank Croatia announced that it achieved a profit of 49 million kuna (before tax) in the first half of the year, which is 45% higher than the profit recorded in the first half of last year.
The main reason for the good business result, as stated by the bank, stems from lower provisions for credit losses in the current year compared to the same period last year. A return on average capital of 5.12% was achieved, which is above the return of the overall system (3.51%).
– We attribute the increase in profit primarily to a very conservative lending and provisioning policy, as well as a cautious market approach. I am particularly pleased that we have managed to maintain a constant increase in market shares, which I hope we will sustain until the end of the year – says Balázs Békeffy, CEO of OTP Bank, who emphasizes that even during the crisis, the bank did not reduce the number of employees.
The bank’s operating result increased by 2%, mainly due to a 3% rise in net fee income and a 9% increase in foreign exchange trading income. At the same time, net interest income recorded a slight decline of 2%, caused by the negative trend in the market interest rates on loans, which the bank seeks to mitigate by managing the prices of its sources. The largest part of the sources remains household deposits, which grew by 2% compared to the same period last year, while the bank’s total balance sheet recorded a growth of 4%.
