Croatian retail loan conversion to cost OTP HUF 7.2 bln

Analysis

LaMography/Moni Lazar

OTP Bank on Friday said that conditions on the conversion of Swiss franc-denominated retail loans into euro loans, approved by Croatian lawmakers on Friday, would have a negative impact on the pre-tax profit of its local unit of HRK 178 mln (HUF 7.2 bln), according to Hungarian news agency MTI. 

Logo of an OTP Banka branch in the oldtown of Trogir, Croatia. (Photo: LaMography/Christian Keszthelyi)

The amendments to the Consumer Lending Act approved by the Croatian Parliament establish the exchange rate valid at origination for the conversion, OTP Bank noted. OTP Bank said its unit, OTP banka Hrvatska, had already made HRK 66 mln of the total HRK 244 mln of provisions for the impact of the conversion.

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