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Shopping spree lifts Q1 OTP profits

First-quarter after-tax profit of OTP Bank climbed 12% year-on-year to HUF 72.6 billion, lifted by the consolidation of acquisitions, an earnings report released early Friday shows, state news wire MTI reported.

Picture: Tupungato/Shutterstock.com

OTP Bank noted that earnings of Bulgariaʼs Expressbank, which it acquired from French peer Société Générale (SocGen), were included in the profit and loss statement for the first time. It added that the acquisition of an Albanian bank it bought from SocGen was closed on March 29, thus the unitʼs earnings were not booked in the P&L statement, but on the balance sheet, under shareholdersʼ equity.

The financial closure of another four recent acquisitions by OTP - in Serbia, Moldavia, Montenegro and Slovenia - is pending.

OTPʼs net interest income rose 13% to HUF 162.7 bln, while net revenue from commissions and fees was up 15% at HUF 57.2 bln.

Return on equity slipped 0.3 of a percentage point, to 15.9%. Earnings per share came to HUF 277 for the period.

Half profit generated abroad

After-tax profit of OTPʼs businesses in Hungary, excluding the effect of the bank levy and the impact of acquisitions, rose 6% to HUF 45.2 bln. Adjusted earnings of its foreign units matched that figure nearly exactly, but climbed 24%.

After-tax profit of OTPʼs business in Bulgaria jumped 54% to HUF 17.3 bln, boosted by Expressbank. Earnings in Ukraine climbed 42% to HUF 8.3 bln and earnings in Croatia were up 7% at HUF 8.2 bln. After-tax profit in Russia dropped 8% to HUF 6.6 bln.

Balance sheet balloons

OTP had total assets of HUF 16.1075 trillion at the end of March, up 19% from 12 months earlier. Shareholdersʼ equity increased 17% to HUF 1.8701 tln.

The gross stock of client loans rose 24% to HUF 9.7588 tln. The retail lending stock was up 16% at HUF 5.8353 tln, while corporate loans rose 33% to HUF 3.6033 tln.

OTPʼs non-performing loan ratio edged down to 5.9%.

The stock of client deposits increased 17% to HUF 12.4021 tln.

OTP said it had gross operative liquidity reserves equivalent to EUR 8.4 bln at the end of March.