OTP expects to pay HUF 167-per-share dividend

The dividend would add up to HUF 46.2 billion and come to HUF 165-per-share, before adjustments for treasury shares, Bencsik said. He noted that the board has not yet decided on the dividend proposal. 

Bencsik confirmed, as the bank said in the report, that losses were not expected this year at either of the units in Ukraine or Russia, even in light of the impact of low oil prices on the Russian economy. 

In order for OTP to maintain its profitability, lending needs to expand, he said, noting that net lending stock fell 7% last year, causing the net loan-to-deposit ratio, cleared of exchange rate changes, to fall to 67%. 

On the domestic market, OTP continues to concentrate on the SME and farm markets, Bencsik said. He added that a 30% increase in Hungarian mortgage lending pointed to a turnaround on the home market. 

OTPʼs share of the mortgage market edged over 26% in the fourth quarter. 

Interest in the governmentʼs recently launched home purchase subsidy scheme for families with children (CSOK) augurs an upswing on the home market and a boon to mortgage lending, Bencsik said. 

Hungaryʼs balanced growth could also give a boost to lending, he said, adding that the stable macroeconomic environment in Hungary should be acknowledged by ratings agencies “sooner or later”. 

OTP targets ROE of 15%, including one-off items, in 2017, Bencsik said, adding that OTP continues to look for acquisition targets, but in those countries in which it already has a presence, he added. 

OTP will complete the takeover of AXA Bankʼs portfolio in Hungary at the end of October or the beginning of November of this year, he said. The acquisition will raise OTPʼs mortgage loan stock by some 20%, he added. 

Bencsik said OTP would evaluate, on a market basis, any offer the National Bank of Hungaryʼs asset manager MARK makes for its bad commercial real estate loans, but whether the sides can agree on a price remains in question.