Gross Profits of Croatian Banks Increase by 150 Percent

Total Croatia News

Good business results for Croatia’s banking sector.

According to preliminary data of the Croatian National Bank, at the end of June this year gross profits of Croatian banks amounted to more than 3.5 billion kuna, which was almost 150 percent more than at the end of June last year. Privredna Banka Zagreb (PBZ) says that the nearly 74 percent reduction in the cost of value adjustments has greatly contributed to such results, reports Jutarnji List on September 12, 2016.

Temporary preliminary data of the Croatian National Bank (HNB) show that 28 Croatian banks at the end of June had a total profit before tax of 3.54 billion kuna. If results of the five building societies are added, then the gross profit of Croatian credit institutions increases to 3.57 billion kuna. Therefore, according to PBZ analysts, the profitability of the credit institutions continued to recover in the second quarter of this year.

The net interest income in the first six months of this year grew at an annual rate of 1.9 percent to 5.5 billion kuna, while net fee incomes grew by 2.9 percent to 1.6 billion kuna. Other incomes doubled, to 1.4 billion kuna, so the gross operating profits jumped by 11.2 percent to 8.4 billion kuna, according to PBZ. At the same time, operating expenses grew by 2.5 percent to 4.3 billion kuna. Thus, the net operating profits amounted to 4.1 billion kuna and were higher by 22.2 percent compared to the same period last year.

HNB’s data for the first half of this year show that in the past year there has been a decline in the number of banks operating at a loss, from seven to five. Their total reported losses before tax stood at 103 million kuna, and the biggest losses, in the amount of 60.4 million kuna, were recorded by Vaba Banka from Varaždin, followed by Veneto Banka (28 million) and Imex Banka (9 million). A little less than 3 million kuna was the reported loss of the Banka Splitsko-Dalmatinska, which entered bankruptcy proceedings on 1 July.

Last year, Sberbank and Hypo Alpe-Adria-Bank recorded losses in the first half of the year, but this year they are in the green. The highest gross profits at the end of June this year were reported by the three largest Croatian banks by asset value – Zagrebačka Banka (953.8 million kuna), followed by PBZ (860.7 million kuna), and Erste & Steiermärkische Bank (556.2 million kuna).


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