Last year, Komerční banka’s net profit fell by 45.3 percent to CZK 8.2 billion. Operating costs increased slightly, operating profit was lower by 16.8 percent, reaching CZK 14.7 billion. Client deposits and loans increased year on year. The economic results for last year were significantly affected by the coronavirus pandemic, the bank said. The main owner of Komerční banka, which is one of the largest domestic financial institutions, is the French Société Générale. The bank’s shares are traded on the Prague Stock Exchange.
“Financial performance was affected by the sharp deterioration in economic conditions associated with the global covid-19 pandemic. KB’s capital adequacy in European banking reached an exceptionally high level of 22.3 percent, before including the 2020 profit. Liquidity also remained extraordinarily strong as net lending represents only 76.1 percent of the volume of deposits from customers, “the bank said. He expects that the discussion with the Czech National Bank on the dividend proposal will begin on the basis of the audited financial statements in March.
Last year, total revenues fell by 8.9 percent to CZK 29.7 billion. Net interest income decreased by 9.5 percent to CZK 21.4 billion, mainly due to a significant decline in market interest rates. Net fees and commissions decreased by 12.9 percent to CZK 5.2 billion, mainly due to lower transaction and sales activity, as well as due to the new regulation of fees for cross-border payments. The net result from financial operations in the amount of CZK 2.9 billion increased by 2.9 percent.
Operating costs rose by 0.4 percent to CZK 15 billion. “This growth was mainly driven by an increased contribution to the Crisis Resolution Fund, and amortization also increased, which is related to investments in the digitization of the bank’s services and operations,” said KB. Personnel costs were lower as the average number of employees fell by 1.3 percent to 8,062. General operating expenses decreased due to savings in travel, marketing, event costs, despite higher IT, telecommunications and protective equipment expenses .
Loans to clients increased by 5.7 percent to CZK 691.4 billion. While housing loans rose by 8.3 percent, consumer loans fell by 1.2 percent. Client deposits rose by 9.4 percent year on year to CZK 893 billion.
“The bank’s profit in the final quarter of last year exceeded market expectations. There was a relatively significant year-on-year decline in net interest income, which is related to the CNB’s policy. Cyrrus analyst Tomáš Pfeiler. According to him, the bank maintains a robust capital adequacy, which will strengthen its position in subsequent negotiations with the CNB regarding a possible renewal of the dividend policy.
Source: CTK
