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Erste Bank losses swell on borrowers' relief provisions

Telco

Erste Bank Hungary's second-quarter losses increased 67% to HUF 43.9 bln from the same period a year earlier as the lender set aside provisions for refunds it must pay under recently approved borrowers' relief legislation, a consolidated earnings report posted on the Budapest Stock Exchange website bet.hu shows.

Erste Bank Hungary booked a HUF 61.5 bln loss on the "other revenue and expenditures" line of its earnings statement, a 132%  increase from the base period.

The lender attributed the entire HUF 35 bln rise to the legislation that requires banks to pay refunds for using exchange rate margins for foreign currency-denominated loans and for making unilateral changes to contracts. Net interest revenue dropped 7% to HUF 43.1 bln.

Net revenue from commissions and fees climbed 20% to HUF 21.1 bln. Provisions for lending losses were down 45% at HUF 18.8 bln. Erste Bank Hungary had total assets of HUF 2,256.2 bln at the end of June, level with the amount at the end of last year. Net assets fell 24% to HUF 140.0 bln. Stock of client loans fell 4% to HUF 1,552.6 bln. Client deposits were down 9% at HUF 1,100.3 bln.

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