Banking Sector Earnings Fall 12% in Q1-Q3

Banking

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Combined after-tax profit of Hungarian banks fell 12.4% year-on-year to HUF 562 billion in Q1-Q3 as write-downs and provisions weighed, data released by the National Bank of Hungary (MNB) on Monday show.

The sector's net interest revenue climbed 45.2% to HUF 1.739 trillion and net revenue from commissions and fees increased 22.7% to HUF 834 bln.

Write-downs and provisions came to HUF 379 bln, up 298.7% from the base period.

MNB acknowledged the impact of the consequences of the war in Ukraine on the figure and said a single, large-scale banking group with "significant foreign exposure" accounted for about two-thirds of net write-downs and provisions. 

Operating costs increased 32.4% to HUF 1.618 tln, boosted by a windfall profit tax.

Total assets of the sector stood at HUF 82.71 tln at the end of September, up 23.8% from 12 months earlier. Lending stock rose 25.1% to HUF 52.371 tln. Stock of deposits increased 22.2% to HUF 66.218 tln.

Lenders' non-performing loan ratio rose to 3.4% from 3%.

Banks' loan-to-deposit ratio was unchanged at 83.4%.

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