Jelasity said the first-half performance was supported by positive business trends, the higher-than-expected interest rate environment, and better-than-expected lending stock developments. Second-half profits are expected to be lower in light of slower than-hoped-for economic growth, lower interest rates, windfall profit tax developments, and the higher financial transactions duty, he added.

He said businesses were taking a wait-and-see approach to investments and drawing on credit, while households were spending cautiously and consumption growth was subdued, all factors impacting this year’s expectations for growth. He added that outlays of home loans in the first half had exceeded the contract volume signed during the whole year in 2023.

Outlays of new personal loans climbed 42% to HUF 45 bln, while outlays of prenatal baby support loans rose 14% to HUF 19 bln, deputy-CEO László Harmati said.

The NPL ratio fell to 2.4% from 2.8% a year earlier, he added.

Outlays of mortgage loans jumped 171% to HUF 67 bln, while the average contract size rose over 30%.

Stock of retail deposits and investments stood at HUF 6.233 tln at the end of June, up 26% from 12 months earlier, said deputy CEO Róbert Cselovszki.

The stock of corporate credit, including bonds, edged down 2% to HUF 1.12 tln. Outlays in the first half were up 19%, lifted by a EUR 90 mln loan, together with parent Erste Group, to CTP Group to finance logistics and industrial park developments in Hungary.