Hungary’s second-largest lender reports swelling profit in Q3

By bne IntelliNews December 1, 2023

Hungary’s second-largest lender MBH reported an adjusted consolidated after-tax profit of HUF93bn (€240mn) in Q3, up 116% y/y. In the first nine months, net profit surged 71% to HUF235bn. Net interest income rose 81% year-on-year to HUF424bn, and net revenue from commissions and fees increased 46% to HUF100.4bn.

MBH booked HUF61.2bn in payments on the bank levy and the windfall profit tax during the period.

Provisions and other impairments came to HUF25.2bn in the first nine months and HUF12.4bn was released during the July-September period, due to the reclassification of customers recovering from moratorium to performing loan

MBH had total assets of HUF10.7 trillion at the end of September, down 1% from twelve months earlier. This compares with OTP’s HUF39.5 trillion.

The loan-to-deposit ratio reached 76.9%, down 1.2pp y/y. The gross stock of client loans was practically flat at HUF5 trillion, and deposit stock edged up 1% to HUF6.5 trillion.

The NPL ratio was 4.2% in the third quarter.

Shareholders' equity increased to HUF993.0bn, down 1.4% y/y.

The 19.2% capital adequacy ratio at the end of the period significantly exceeded the regulatory minimum requirements, the lender said.

MBH Group’s off-balance sheet exposure was HUF1.6 trillion at the end of September, down 2.2% y/y.

MBH Bank completed the three-way tie-up between three mid-sized banks in April to create a Hungarian-owned national champion in the sector. The merger between MKB Bank, Takarekbank and Budapest Bank spanning more years enjoyed headwind from regulators and the state. Hungary’s richest man, Viktor Orban’s childhood friend Lorinc Meszaros has a minority stake in Magyar Bankholding, which owns 98.9% of the shares.

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