OTP first quarter profit down, but beats forecasts

OTP, Hungary’s largest banking group has beat
analayst forecasts with with a fall of only 2 percent in net profit
to HUF42.38 billion ($187.7 million) for the first quarter of 2010,
from HUF43.34 billion in the year-ago quarter.

The bank said: “Such results were achieved
despite significant risk costs and declining interest income.”

Net interest income slumped 10 percent to
HUF142.63 billion, while risk provisioning remained high at
HUF54.48 billion, up 20 percent from the corresponding quarter in
2009.

The bank added that deposit collection
continued with “lower intensity, whereas loan volumes
stagnated”.

Customer deposits ticked 3 percent higher to
HUF5.74 trillion for the first quarter of 2010, but customer loans
fell 10 percent to HUF6.91 trillion.

However the bank said the retail segment was the “single most
important part” of the loan portfolio, accounting for 62 percent,
adding that it would aim to expand the loan book by 5 percent in
2010.

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