2024, the Most Successful Year in OTP Bank History

OTP closed the most successful year in its history in 2024, the bank achieved outstanding profitability, its capital position is extremely stable, and it is the market leader in the region, the bank's CEO, Sándor Csányi said at the annual general meeting of the company in Budapest on Friday.

He stated that OTP had acquired 26 financial institutions in its history – 14 in the last ten years –, and is the market leader in five countries. OTP has grown its balance sheet total to EUR 106 billion at the end of 2024, a threefold increase in ten years, putting it in the category of European medium-sized banks.

Last year, the group achieved outstanding profitability, with an ROE (return on equity) of 23.5% in 2024, a CET1 ratio of 18.9% and a net loan-to-deposit ratio of 74%.

Alongside the improvement in margins, cost efficiency also improved: the operating cost/income ratio fell to 41.3%, a historic low. The cost of credit risk ratio increased to 0.38%, mainly due to more prudent provisioning.

The Hungarian operations achieved an adjusted profit of HUF 270 billion last year, excluding dividends from subsidiaries, an increase of 16%, against an exceptionally high capital adequacy ratio of 29.3%.

In the Hungarian market, OTP had a 28.9% share in mortgage lending, 39.8% in baby loans, 47.9% in personal loans and 41.5% in retail deposits at the end of 2024, he said. Corporate lending is characterized by exclusion, the bank's market share in the Hungarian market was 19.5%, and 57% in municipal loans, he added.

The CEO pointed out that the "special bank burden" in Hungary is the highest in Europe, with withdrawals reaching HUF 263 billion this year, up from HUF 172 billion last year, of which HUF 176 billion is transaction tax, a significant part of which is passed on, but risks losing customers to financial services providers such as Revolut.

He also said that all of OTP's subsidiaries made a profit in 2024, with foreign profit contribution of almost 70%. The Bulgarian subsidiary DKS Group made a profit of HUF 201 billion and the Russian subsidiary HUF 137 billion after tax. He noted that it was a good decision to stay in the Russian market, with a dividend of USD 500 million in the last period.

He pointed out that lending is picking up in Ukraine, with a 20% increase last year. The exposure to Russia and Ukraine in the group's net loan portfolio fell to 6% at the end of 2024 from 14% in 2014.