Profits were under the HUF 20.3 billion estimate by analysts polled by Portfolio.hu.
Earnings per share came to HUF 64 in Q4, down also 18% from HUF 78 in the same period a year earlier.
OTP Bank booked a HUF 18.1 billion cost related to the bank levy, introduced in 2010, on the “other expenses” line of its P+L statement. Excluding the tax, open forex positions, dividend and net cash transfers, and goodwill impairment, after-tax profit would have climbed 56% to HUF 31.81 billion, the bank said.
OTP Bank’s foreign units generated 7% of consolidated after-tax profit.
Provisions for possible loan losses came to HUF 70.0 billion in Q4, 12% less than in the same period a year earlier. The ratio of non-performing loans (NPLs) – those past 90 days due – rose to 13.7% at the end of 2010 from 9.8% at the end of 2009.
OTP Bank’s net interest income inched up 2% to HUF 155.13 billion. Net interest margin was unchanged at 6.23%. Net fees and commissions rose 9% to HUF 37.58 billion.
Operating expenses edged up 1% to HUF 95.5 billion. Cost-to-income ratio rose to 47.1% from 46.9%.
Return on assets (ROA) rose to 1.3% from 0.8% and return on equity (ROE) climbed to 9.6% from 6.8%.
For the full year, OTP Bank booked net income attributable to equity holders of HUF 117.68 billion, down 22% from 2009. The bank levy was largely to blame for the drop.
Excluding the cost of the extraordinary tax, open forex positions, dividend and net cash transfers, and goodwill impairment, after-tax profit would have risen 7% to HUF 161.86 billion, the bank said.
OTP Bank booked a HUF 36.1 billion cost for the bank levy in 2010 but the net effect was HUF 29.5 billion, the bank said.
Provisions for loan losses – up 11% at HUF 273.1 billion – also hit the bottom line.
OTP Bank booked goodwill impairment of HUF 18.5 billion at its units in Serbia and Ukraine, but the net effect was about HUF 15 billion.
OTP Bank’s foreign units generated 10% of consolidated after-tax profit.
Net interest income rose 5% to HUF 620.4 billion. Net fees and commissions climbed 3% to HUF 136.7 billion.
Operating costs were up 1% at HUF 354.1 billion. Cost-to-income ratio fell to 43.1% from 44.4%.
ROA rose to 1.7% from 1.6%. ROE fell to 12.9% from 13.4%.
OTP Bank had total assets of HUF 9,780.6 billion on December 31, 2010, practically level with twelve months earlier. Net assets rose 10% to HUF 1,308.6 billion.
Client loans rose 9% to HUF 7,502.3 billion. Retail loans were up 11% at HUF 4,769.8 billion and corporate loans increased 6% to HUF 2,286.4 billion.
Allowances for loan losses were up 54% at HUF 761.3 billion.
In Hungary, restructured loans accounted for 6.6% of the total retail portfolio, the bank said, adding that the pace of restructuring lost momentum.
OTP Bank’s capital adequacy ratio rose to 17.5% from 17.2%.
Client deposits inched up 2% to HUF 5,821.5 billion. Retail deposits were up 5% at HUF 4,368.0 billion but corporate deposits slipped 4% to HUF 1,424.6 billion.
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