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Report: Hungarian banks make most from customers in region

MNB

Banks in Hungary outstrip their regional peers in terms of having the highest net margins (adjusted for provisions), meaning that they earn proportionately the most from their customers, according to a report today by online economic and financial portal Portfolio.hu.

The portfolio.hu overview shows that although the Central and East European banking sector is performing better and better, a low interest rate environment and stricter regulations mean much more modest growth and profitability than before the financial crisis.

The article reveals that in the region, banks in Slovakia are the most active in lending, and those in Slovenia the least, while Hungary falls in the mid-range in this regard.

While Czechsʼ borrowing debt is the highest as a proportion of GDP, that of Romanians is the lowest. In Slovakia the proportion of mortgage loans is high, while in Bulgaria the share of corporate loans is significant, the report says.

The portfolio.hu article says Slovenian banks enjoy the best capital position, and Polish banks the weakest in the region, while the Hungarian banking system is relatively strong and stable. However, it adds, the most interesting piece of data concerning Hungary is that in both 2015 and 2016, Hungarian banks recorded the highest margins in proportion to assets in the region. 

The return on equity was greatest for Czech banks last year, but the Hungarian banking system overtook this in the first half of 2016. Portfolio.hu concludes that despite the special taxes on banks in recent years and relatively slack lending activity, banks in Hungary are earning the most in the region.

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