Raiffeisenbanks Czech unit says net profit falls by 15.5% y/y in Jan-Sep.

By bne IntelliNews December 2, 2010
The country's fifth-largest bank Raiffeisenbank CR, owned by Austria's Raiffeisenbank, said its net profit of dropped by 15.5% y/y to CZK 1.4bn (EUR 53.8mn) in Jan-Sep. Raiffeisenbank CR CEO Lubor Zalman explained that the reported fall in the net profit reflected above all accounting issues, namely higher volume of adjusting entries for households and reassessment of derivatives. Zalman underlined that the bank fares well in terms of trading results. Net interest income expanded by nearly 13% to CZK 5.3bn and was linked to the 6.5% y/y expansion in provided loans to CZK 150.1bn. The quality of loan portfolio to the corporate sector started to gradually improve, while the one to households is still deteriorating due to the high unemployment rate. Zalman expects improvement in the household segment to be seen only in H1 of 2011 at the earliest. The total assets of the bank grew by 2% y/y to CZK 185.3bn. The capital adequacy of the bank stayed high at 10.6%. The bank attracted CZK 124.7bn worth of deposits, up by 5% y/y, proving that the lender had managed to maintain a high level of client trust. In 2011 Raiffeisenbank wants to focus mainly on wealthy clients and thus plans to establish special business points, the first of which is to open doors in January. The bank also plans to open 50 new branches in Prague and other large cities. The aggregate net profit of the local commercial banks increased by 8.6% y/y to CZK 43.7bn in Jan-Sep, with the four largest domestic banks - CSOB, Ceska Sporitelna, Komercni Banka and UniCredit, accounting for 68.6% of the overall profit. The banks' total assets increased by 3.5% y/y to CZK 4.2tn at end-September with the four major banks comprising a share of 65.8%.

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