Erste Bank Hungary Closed the Past Year with Success

Erste Bank had a successful year in 2022, with lending growth and operating income up, but profits lower than in the previous year due to one-off tax and regulatory charges, Erste CEO Jelasity Radovan has told a press conference in Budapest.

He added that two acquisitions were successfully completed last year, the takeovers of Commerzbank Plc. and brokerage firm Random Capital. With a unique performance within the international banking group, the Hungarian bank doubled its revenues in six years, from HUF 109 billion to HUF 221 billion last year, with an annual growth of 25.3%, he said.

Net interest income rose 66.8% last year to HUF 160 billion. This was partly because the bank accounted for part of its trading income here, so the trading and conversion income line fell by HUF 20.8 billion. The 17.1% (HUF 87 billion) increase in fee and commission income was driven by higher transaction activity from active clients and the performance of the investment business.

Operating expenses increased by 16.7% to HUF 96.5 billion, less than the growth in revenues, and Erste's operating profit increased by 33% to HUF 124.9 billion. The cost/income ratio fell to 43.6% last year from 46.8% a year earlier. At the same time, other operating profit decreased by HUF 32.5 billion compared to 2021, mainly due to one-off tax and regulatory burdens (extra profit tax, interest rate freeze, transaction levy increase, extraordinary OBA payment).

Profit after tax was thus 9.7% lower at HUF 53.5 billion, while the bank ended 2021 with a profit of HUF 59.2 billion, he said.