OTP Bank - H1 sound as promised
H1 sound as promised
OTP’s reported net profit came to HUF 122 bln, above market estimates of HUF
114 bln but somewhat below our forecast of HUF 127 bln. The difference from consensus stemmed from lower provisioning while our estimates were ahead in terms
of risk cost and slightly better revenues.
Key positives
Revenue lines were stellar on growing net interest income (+4% q-o-q) on the back
of strong volumes and stabilizing NIM while net F&C was also remarkable on business activity, tourism (+12% q-o-q). Strong lending volumes continued in HU (+6%
q-o-q). ROE amounting to 16.7% in the first half of the year, up from 6.4% a year
ago.
Key negatives
Stage 2 stock increased by 1.8% q-o-q due to HU and NIM erosion continued in
BG, Serbia. FX had a negative impact in the quarter on loan book.
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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