Net profit of Czech Raiffeisenbank unit falls 6.6% y/y in H1.

By bne IntelliNews September 9, 2010
The net profit of the country's fifth-largest Raiffeisenbank fell by 6.6% y/y to CZK 930mn (EUR 36.1mn) in H1, CEO Lubor Zalman announced. Zalman explained that the reported fall in the net profit reflected above all accounting issues, namely the overvaluation of the derivatives protecting the bank against the risk of interest rates fluctuation. Net interest income expanded by 12.7% to CZK 3.5bn and was linked to expansion of the provided loans - by 5.7% y/y to CZK 148.6bn. The quality of the portfolio of loans to the corporate sector started to gradually improve, while that of loans to households is still deteriorating due to the high unemployment rate. Zalman expects improvement in the household segment to be seen only next year at the earliest. The total assets of the bank grew by 9.6% y/y to CZK 192.3bn. The capital adequacy of the bank stayed high at 10.77%. The bank attracted CZK 124.2bn worth of deposits, up by 10.8% y/y, proving that the lender had managed to maintain a high level of client trust. The aggregate net profit of the local commercial banks increased by 17.9% y/y to CZK 31.4bn in H1 - the three largest domestic banks - CSOB, Ceska Sporitelna and Komercni Banka, netted a total of CZK 19.5bn and accounted for 62.3% of the profit in the whole banking sector. The banks' total assets increased by 2.7% y/y to CZK 4.2tn at end-June with the three major banks accounting for 58.9%.

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