Czech Raiffeisenbank unit raises net profit by 26% y/y in Q1.

By bne IntelliNews June 4, 2010
The country's fifth-largest Raiffeisenbank increased its net profit by 26% y/y to CZK 430.8mn (EUR 16.7mn) in Q1. The net interest income expanded by 14% to CZK 1.7bn and was linked to expansion of the provided loans - by 4% y/y to CZK 145.5bn. Losses and costs linked with default of loans and higher provisioning for doubtful loans and claims grew by 17% y/y to CZK 542mn. The total assets of the bank grew by 6% y/y to CZK 185bn. The capital adequacy of the bank stayed high at 10.7%. The bank attracted CZK 122.5bn worth of deposits, up by 11% y/y, proving that the lender had managed to maintain a high level of client trust. CEO Lubor Zalman said he did not expect a strong economic revival this year, while the still to grow unemployment is to result in a higher rate of loan defaults - thus the bank's main objective this year will be to continue exacting claims. The bank plans to speed up its expansion in 2011 - it intends to open new branches and hire new employees in the next two years. The aggregate net profit of the local commercial banks increased by 15.8% y/y to CZK 13.8bn (EUR 532.1mn) in Q1 - the three largest domestic banks - CSOB, Ceska Sporitelna and Komercni Banka, netted a total of CZK 10.2bn and accounted for 74.2% of the profit in the whole banking sector. The banks' total assets declined moderately by 0.4% y/y to CZK 4.1tn at end-March with the three major banks accounting for 58.8% of the total.

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