< /p> Česká spořitelna – logo. Illustration photo
Prague/Vienna – Last year, the unaudited consolidated net profit of České spořitelna (ČS) rose by 42.2 percent year-on-year to 20.2 billion crowns. According to the bank, this is due to a significantly higher operating result reflecting business growth and overall recovery after the covid-19 pandemic. Operating profit reached 28.5 billion crowns, a year-on-year increase of 30 percent. Today, Česká spořitelna provided consolidated financial results to ČTK in a press release.
Operating revenues increased year-on-year by 17.8 to 49.9 billion crowns, according to the bank, they were influenced by increasing net interest income, net income from fees and commissions and net profit from business operations.
Net interest income, the most important component of operating income, increased by 18.1 percent compared to 2021 to 36.7 billion crowns. Client loans and deposits grew, the development was also supported by investments in bonds. “Net interest income was also positively affected by the environment of higher interest rates reflected on the side of loans and deposits,” the bank said. Net income from fees and commissions increased year-on-year by 3.5 percent to 9.5 billion crowns and net profit from business operations rose by 115.9 percent to 3.7 billion crowns, which, according to the bank, was due to higher business growth and overall development after the covid-19 pandemic.
“The most significant contribution to revenues was the increase in net interest income in the first half of the year, when the CNB in particular raised interest rates. I expect that net interest income will not grow significantly in the following year due to the current policy setting of the CNB,” said XTB analyst Tomáš Cverna. The CNB last raised interest rates last June, and has kept them at seven percent ever since.
Total operating costs increased by 4.6 percent year-on-year to 21.3 billion crowns, with staff costs and other administrative costs rising in particular, the bank said.
The consolidated balance sheet amount reached 1.6 trillion crowns at the end of last year, according to the bank, it did not change year-on-year. “The development on the active side of the balance sheet was mainly caused by the growth of loans to clients, which was outweighed by the decrease in loans to banks. The passive side of the balance sheet was affected by deposits from clients together with deposits from banks, which were compensated by the decrease in bonds,” the bank said. The gross volume of client loans increased year-on-year by 9.1 percent to 934.7 billion crowns, and client deposits increased by 6.1 percent to almost 1.3 billion crowns.
Česká spořitelna also reminds in the press release, that last year it signed an agreement to purchase the loan portfolio of Sberbank CZ in liquidation. “Finalization of the transaction is expected during the first half of 2023,” it said.
Česká spořitelna is the largest bank in the Czech Republic by the number of clients, with over 4.5 million. The Austrian financial group Erste Group Bank, which owns Česká spořitelna, is a key player in the banking market of Central and Eastern Europe. That year, net profit rose to 2.16 billion euros (51 billion crowns) from 1.92 billion in 2021.
According to analyst Wood & Company Marty Jezewská-Wasilewská Erste's results exceeded market expectations as net interest income grew in particular. Cverna pointed out that the expected further increase in interest rates by the European Central Bank can support Erste's results this year.
The largest banking houses, including ČS, will pay tax on extraordinary profits in the Czech Republic starting this year. The so-called windfall tax was approved by the government as a 60 percent tax surcharge on excess profits. This corresponds to the difference between the tax base and the average cost of the tax base for the last four years increased by 20 percent. The income from the tax is to be used by the government to cover the extraordinary costs that the state will have in connection with the capping of energy prices.
Erste Bank, the owner of Česká spořitelna, increased its operating profit by 16 percent last year
According to preliminary results, the Austrian banking group Erste Group Bank, which owns Česká spořitelna, increased its operating profit by 16.3 percent to four billion euros (94.5 billion CZK) last year. Interest in loans and interest growth, as well as a reduction in operating costs, helped mainly. Net profit attributable to the owners of the parent company increased to 2.16 billion euros from 1.92 billion euros a year ago. Erste, which is a key player in the banking market of Central and Eastern Europe, stated this in a press release today.
Erste's net interest income increased by 19.6 percent to 5.95 billion euros. This was caused by an increase in the volume of loans in all markets and in all segments and an increase in interest rates in all major markets. Net fee and commission income increased by 6.5 percent to 2.45 billion euros, mainly due to growth in payment services and asset management.
“CEE economies proved more resilient in the past year , than expected: despite the problems caused by the terrible war in Ukraine, they recorded solid GDP growth,” said CEO Willi Cernko. Although the Central and Eastern European region will face a sharp decline in economic growth this year, Erste does not expect the region to slip into recession . The bank is convinced that this area will continue to grow, added Cernko.
The volume of client loans increased by 12 percent to 202 billion euros last year, the rate of defaulted loans decreased to a record low of two percent. Client deposits grew by 6.4 percent to 224 billion euros, with the most significant increases in Austria and the Czech Republic.