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Erste Bank Hungary H1 profits decline 13.8% euro terms

Erste Bank Hungary generated net profit of €41.3m in the first half of 2009, down 13.8% yr/yr in euro terms from €47.9 million in H1 of 2008, Vienna-based Erste Bank reported in its consolidated first-half report.

The result was virtually unchanged in forint terms, the report noted. (The forint weakened 14% against the euro in the period.)

ROE, based on net profit, fell to 21.9% in the first half of 2009 compared to 30.4% a year earlier.

Net interest income in the Hungarian retail and SME business rose 18.4% to €159.8 million, primarily due to an improvement in margins, the report said. Net income from fees and commissions dropped a sharp 40.5% yr/yr to €38.8 million.

Including a 53.1% increase in net trading results, to €12.4 million, operating results rose 13.4% from H1 2008 to €105.8 million.

General administrative expenses declined 8.5% yr/yr to €105.3 million, the report said adding that first-half personnel expenses at Erste Bank Hungary were unchanged from last year.

The cost/income ratio improved to 49.9% in the first half of 2009 from 55.2% in the first half of 2008.

Risk provisions rose to €60.1m in the first half of 2009 from €29.0 million in H1 of 2008. The report attributed the rise to “the general economic trends in Hungary and the associated currency trends.”

A sharp rise of other results, to €9.5 million from €1.2 million in H1 2008 primarily reflected the sale of real estate.

Pre-tax profit was down 15.6% yr/yr to HUF 55.3 million. (MTI – Econews)