OTP Bank net profit in Romania down by 12 percent

The net profit of OTP Bank in Romania dropped by 12 percent year-on-year in the first nine months of 2016, to EUR 7.05 million. Concurrently, revenues decreased by 10 percent, according to data published by the bank on Friday.

In Q3, the net profit contracted year-on-year by EUR 1.9 million. Compared to Q2, the drop in net profit was 40 percent.

According to OTP representatives, the drop in the net profit was caused by the high taxes paid by the bank in Romania. The bank reported an EUR 20.7 million profit, the same as last year.

Total revenues dropped by 10 percent year-on-year in the first nine months, to EUR 64 million, especially due to revenues obtained from interests. According to OTP Bank representatives, the main reason for the decline of total revenues was the 10 percent decrease of net revenues from interests and commissions compared to the first nine months of 2015, to EUR 8 million.

The low margin mortgage loans converted to Swiss francs had, in turn, a negative impact on net revenues obtained from interest, which decreased by 14 percent in annual terms, to EUR 48.4 million.

Operating expenses dropped by 14 percent year-on-year, to EUR 43.3 million. Risk provisions dropped by 1 percent in the first nine months year-on-year, to EUR 12.5 million. The total assets of OTP Bank Romania decreased by 9 percent year-on-year, to EUR 1.83 billion and by 6 percent compared to June 2016.

The gross balance of loans decreased by 6 percent compared to the end of last year to EUR 1.8 billion and by 2 percent, compared to June. The rate loans with late payments of over 90 days increased by 1.4 percent compared to September 2015, to 17.9 percent, but dropped by 0.8 percent compared to June 2016.

Deposits went up by 2 percent, compared to September 2015, to EUR 1 billion. Compared to June 2016, deposits decreased by 5 percent. The conversion of loans in Swiss francs, started in December 2015, closed on 31 August 2016, the bank said.

Georgeta Gheorghe