Hungary's banks had combined unconsolidated pre-tax profit of HUF 306 billion (€1.16 billion) in 2009, up 5.5% from the previous year, preliminary data calculated according to Hungarian Accounting Standards and compiled by the International Training Center for Bankers (ITCB), a Budapest-based consultancy, show.
The ITCB analysis, published in a newsletter of the Hungarian Banking Association, showed OTP Bank - Hungary's biggest commercial bank - had both the biggest profit and the biggest profit growth in 2009. Pre-tax profit doubled at the parent bank and the profit of OTP Bank's mortgage unit was two and half times bigger than in 2008.
Citibank took third place on the list in terms of the size of unconsolidated pre-tax profit, increasing its profit by almost 40% and overtaking Erste Bank, which finished fourth. Erste saw its profit decline more than 20% in 2009 from the previous year.
K&H Bank finished fifth, improving its profit by 25%, overtaking UniCredit, which saw its profit halved from the previous year.
Raiffeisen and CIB were the biggest losers of the year in terms of profit, with both banks losing close to 80% of their profit compared to one year earlier. MKB was unable to recover over the past two years, eroding its profit to almost zero in the fourth quarter of last year.
Of the revenue components, interest revenue rose 16% and non-interest revenue increased 65%. Operating costs fell 2% yr/yr, while impairment and risk provisions tripled.
The banking sector improved its relative efficiency significantly, with the cost-to-income ratio falling from 51% in 2008 to 42.6% in 2009 at bank-sector level.
All the large banks improved their cost-efficiency, with OTP achieving the best result with a cost-efficiency ratio of under 40%. UniCRedit, Erste, MKB and Raiffeisen achieved ratios of less than 50%.
The bank sector's ROE excluding the branches fell from 11.3% in 2008 to 9.4% yr/yr.
In terms of ROE, Erste was the most profitable among the large banks with 15% ROE in 2009, followed by FHB mortgage bank, OTP, Budapest Bank and K&H.
Profitability in terms of ROA also deteriorated, falling from 0.88% at the end of 2008 to 0.75% at bank-sector level.
In terms of ROA, OTP was the most profitable bank with 1.71% ROA compared to 0.97% in 2008. Among the large banks, Budapest Bank and FHB mortgage bank achieved ROAs higher than 1%, although both posted figures slightly below their 2008 levels. Erste achieved the next best result, significantly decreasing its ROA indicator, followed by UniCredit and K&H, which improved its figure slightly.
The bank sector' net interest-margin slightly improved from the end of 2008 to 2.8% in 2009.
Lending and deposit rates fell in both the retail and the corporate segments in 2009, offsetting each others' impact. As a result, the net interest-margin remained almost unchanged.
The loan/credit ratio, which reflects the bank sector's liquidity position, improved significantly from 162% at the end of 2008 to 151%. As a result, none of the large banks has a ratio above 200%; in fact, all except K&H and Raiffeisen improved their liquidity positions, and these two saw their indicators deteriorating only slightly.
The bank sector's average capital adequacy ratio rose from 11.2% in 2008 to 12.9%. (MTI-ECONEWS)