The Agrokor crisis has left its mark on banks’ balance sheets.
In the first quarter of this year, according to provisional unaudited data from the Croatian National Bank, banks in Croatia recorded profits before taxation which total the amount of 448.5 million kuna, 70 percent less than in the same quarter last year, reports Jutarnji List on June 2, 2017.
The data of the Croatian National Bank (HNB) is based on the information provided by the banks themselves, not including Banka Splitsko-Dalmatinska, which went bankrupt in the meantime.
Compared with HNB data from the end of the first quarter of last year, banks’ profits declined by 70.2 percent, or by more than one billion kuna – from 1.5 billion kunas last year to 448.5 million kunas in late March this year.
At the same time, the number of banks which recorded losses has also increased. Last year, six banks posted losses, while this year there are ten such banks. The biggest loss, in the amount of 229.4 million kunas, was recorded by Zagrebačka Banka, the largest bank in Croatia, which in the same period last year reported profits of more than 492 million kunas. Zagrebačka Banka explained that this result was a product of an increase in the value adjustments of loans given to companies and by new reserves of 800 million kunas.
By contrast, the highest pre-tax profit at the end of the first quarter, in the amount of 332.8 million kunas, was posted by Privredna Banka Zagreb, although that number was 2.6 percent lower than last year. It is followed by Erste&Steiermaerkische Bank, whose pre-tax profits amounted to 171.14 million kunas, and Raiffeisenbank Austria, with 122.2 million kunas in profits.
The data has been analysed by the Croatian Banking Association, which explained that the profitability indicators recorded a slight decline in the first quarter. The reason lies in the increased costs of reserves in the reporting period. They point out that the fact that the Croatian banking system is capable of handling shocks like the Agrokor crisis is demonstrated by the capital adequacy ratio of Croatian banks, which has reached a new maximum of 23.1 percent.
