This report analyses the performance of Hypotecni Banka for the 2Q2019. You will find all the necessary details regarding volume growth, market share, margin and asset quality development in the Bank.
The key highlights are:
Hypotecni Banka made a net profit of CZK 601 mil in the second quarter of 2019, down 1.22% when compared to the previous year. Total revenues decreased 1.2% yoy to CZK 930 mil, ROE amounted to 5.60% and the NPL ratio stood at 1.11%. In the last three years, the bank grew its loans by 8.33% a year, revenues rose by -10.1% and net profit increased by -10.5% a year, on average.
Revenues decreased 1.2% yoy to CZK 930 mil in the second quarter of 2019. Interest income formed 89.8% of total revenues with the net interest margin decreasing 0.916 bp to 1.06% of total assets. Fees added a further 9.91% to total revenue generated in 2Q2019, down from an average of 11.3% as seen in the previous two years.
Operating costs dropped by 1.37% yoy to CZK 221 mil, so cost to income ratio reached 23.8%, up by 20.6% compared to the previous two years. Staff accounted for 62.0% of total operating expenditures. At the end of second quarter of 2019, the bank operated a network of 30.0 branches and 493 employees.
Loans and deposits grew by 1.95% and 90.7% qoq respectively, so loan to deposit ratio reached 113% at the end of 2Q2019. That’s down from 114% the previous year. Equity reached 13.7% of assets and capital adequacy ratio amounted to 42.2% at the end of the second quarter of 2019.
NPLs were 1.11% of total loans at the end of the quarter. Provisions covered 43.3% of non-performing loans
When compared to selected peers, Hypotecni Banka was 70.9% less profitable in terms of ROE, achieved 39.6% worse cost efficiency when measured by cost to income ratio and grew its loans by 45.8% slower based on a last year comparison.