Results for Czech banks are down compared to 2019 so far, but they’re not nearly as negative as had been anticipated following the outbreak of the Covid-19 pandemic. Overall, just 1.9 percent of all mortgages were in trouble at the end of September, which is exactly where it was as of the end of June. The daily Hospodarske noviny writes that the continuing demand for mortgage loans has supported the banks through a period that was was otherwise quite negative. Moneta bank announced that it turned a profit of CZK 760 million in the third quarter, though this was 32 percent less than in 2019. Ceska sporitelna’s profits fell 23 percent to CZK 3.3 billion. CSOB has not announced its Q3 results as of yet but HN is reporting that it will be cancelling up to 170 jobs at its branches. Roughly 80 people have already been made redundant while another 40 will be let go in the coming months. The move is connected with the growing popularity of online banking that’s sweeping the entire banking industry.
This year has proven to be an unexpected stress test after seven years of expansion during which consumers and companies took out record volumes in loans. Profits began falling during the first quarter of the year and worsened in the second as a result of the spring lockdown that froze the economy. But the opening of the economy in the third quarter allowed growth to return, meaning that banks didn’t have to set aside as much in reserves. Ceska sporitelna for example only set aside CZK 3.6 billion in reserves, down from CZK 4.7 billion in the second quarter. Moneta bank’s reserves for the third quarter were just CZK 554 million, a third of the amount it set aside in the second quarter.
