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OTP Bank Q2 profit climbs 10%

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OTP Bank on Friday said its consolidated second-quarter after-tax profit rose 10% to HUF 41.1 billion from the same period a year earlier. The increase was supported by a fall in corporate taxes, the bank's IFRS report shows. 

After-tax profit was well over the HUF 33.7 billion estimate by analysts polled by Portfolio.hu. Diluted earnings per share came to HUF 153. Net interest income rose 5% to HUF 158.9 billion and net fees and commissions were up 7% at HUF 37.9 billion. Pre-tax profit dropped 20% to HUF 46.1 billion. The bank paid HUF 9.1 billion in corporate taxes, 28% less than in the base period.

OTP Bank's foreign units accounted for 42% of consolidated profit. While profit at OTP Bank's core business in Hungary was down 24% at HUF 22.8 billion, it increased 19% to HUF 11.0 billion at its unit in Russia and nearly tripled to HUF 5.7 billion at its Bulgarian unit. The bank's units in Ukraine, Serbia and Montenegro were loss-making in Q2.

The proportion of non-performing loans in the bank's lending portfolio rose to 18.8% at the end of the period from 15.4% a year earlier. Allowances for possible loan losses rose 35% to HUF 1,077.3 billion during the same period.

Return on equity narrowed by 2.9 percentage points to 10.6%. Return on assets slipped four-tenths of a percentage point to 1.5%.

OTP Bank had total assets of HUF 9,937.2 billion on June 30, 2% more than twelve months earlier. Net assets were up 6% at HUF 1,420 billion.

Gross client loans, adjusted for foreign currency, fell 2% to HUF 7,554.2 billion. Retail loans slipped 1% to HUF 4,933.5 billion. Corporate loans were down 3% at HUF 2,227.9 billion.

FX-adjusted client deposits were flat at HUF 6,170.7 billion. Retail deposits rose 3% to HUF 4,593.4 billion. Corporate deposits were down 11% at HUF 1,527.8 billion.

OTP Bank's first-half after-tax profit fell 28% to HUF 53.9 billion. Pre-tax profit was down 10% at HUF 97.3 billion.

First-half net interest income rose 7% to HUF 323.1 billion. Net fees and commissions climbed 6% to HUF 72.0 billion.

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