OTP beat estimates in Q1
OTP reported higher than expected profit for Q1/24. Consolidated PAT totalled HUF 240bn
(+8% vs. consensus), driven by improving NIM QoQ, cost efficiency and credit quality.
Total risk cost surprisingly comprised HUF +7bn, massively beating analysts’ expectations
of HUF -20bn and our estimate of HUF -25bn) due to provision releases in OTP Core, CR
and UKR, offset by UZB, RU and RO. Importantly, Uzbekistan risk cost dropped two-third
QoQ. Total assets grew +5% QoQ to HUF 41,482bn), driven by a 1% increase in
performing customer loans and HUF depreciation. Foreign banks accounted for 74% of the
PAT. OTP posted an EPS of HUF 895 in Q1/24, representing a +24 QoQ or +81% YoY
increase, distorted by the fact that in Q1/23 NKBM had only a 2-month profit contribution.
ROE reached 22.7%. Based on the old methodology, adjusted EPS would come in at HUF
1,054 (+23% QoQ or +54% YoY). CAR and CET1 adequacy ratios increased by 0.1%pt to
19% and 16.7%, respectively. OTP left its FY2024 guidance unchanged.
OTP Bank is a financial institution based in Hungary. Co. is engaged in retail banking (account management, bankcards and Electronic sevices - OTPdirekt) corporate banking and private banking. In Hungary traditional banking operations are performed by Co. while specialized services, including car leasing, investment funds and insurance are developed and offered by Co.'s subsidiaries. Co. expands its operations throughout the region via its foreign subsidiaries. As of Dec 31 2011, Co. had total assets of HUF10,200,527,000,000 and deposits of HUF6,398,853,000,000.
Concorde Securities Ltd. is Hungary’s leading independent company engaged in investment banking activities. It provides its clients with integrated financial services, including securities trading, research, corporate financing advisory, capital market transactions, wealth management and investment advisory. The operational management of the company is the responsibility of the CEO, while the owners/managers (who control one-third of the company through their shares and options) are in charge of its strategic governance. Concorde Securities Ltd. is a member of the Budapest, Frankfurt, Warsaw and Bucharest stock exchanges, as well as of the Hungarian Association of Investment Service Providers.
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