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Erste Q1 earnings in Hungary lifted by moratorium base effect

Banking

Austria's Erste Group booked net income of EUR 40.1 million at its business in Hungary in the first quarter, climbing from EUR 9.1 mln in the base period, state news wire MTI reports, citing an earnings report released this week.

Net interest income rose 20% to EUR 66.1 mln and net revenue from commissions and fees increased 8% to EUR 49.2 mln.

Earnings rose in part because of a loss booked in the base period related to a repayment moratorium.

Hungary's government-mandated a blanket moratorium on loan repayments last spring to ease the economic fallout from the coronavirus crisis. The moratorium is set to end on June 30, 2021.

Moratorium-related losses raised the Hungarian business's loss on the "other result" line to EUR 41.2 mln in the base period, nearly double the EUR 21.2 mln loss in Q1 2021.

Erste Group noted that the "other result" line also includes the EUR 14.7 mln the Hungarian business paid on the bank levy, EUR 11.6 mln for the transaction duty and a EUR 4 mln contribution to the resolution fund.

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