News

1Q2016 Consolidated UniCredit Bank Business Results

UniCredit Bank Czech Republic and Slovakia achieved consolidated net profit of CZK 1.3 billion for the first three months of 2016. Stable growth in lending, deposits and an increase in the number of clients with unbeatable U konto.

• Consolidated net profit went down slightly by 4.2% yoy adjusted for the effect of the contribution to the Resolution Fund and the Deposit Insurance Fund, which was posted in 1Q2016. Having accounted for the mandatory contribution, it went down by 20.3% yoy to CZK 1.3 billion.
• Operating income was down 8% yoy.
• Compared to 31 March 2015, loans to clients rose by 5.5%.
• Customer deposits increased by 14.2% yoy.
• Total assets went up by 16.5% yoy.
• Consolidated capital adequacy is 15.62% (non-audited data).
• In its Private Banking Survey 2016, the renowned Euromoney Magazine awarded UniCredit Bank for its innovative private banking technology and its Art Banking service, oriented on investment in art. In the Mergermarket Agency’s M&A Awards, UniCredit was awarded Financial Adviser of the Year Central &Eastern Europe thanks to its advisory in the Czech Republic and Slovakia.

The after-tax preliminary consolidated profit of UniCredit Bank Czech Republic and Slovakia decreased from CZK 1,677 million (as of 31 March 2015) to CZK 1,337 million (as of 31 March 2016). Mr Jiří Kunert, CEO and Chairman of the Board of Directors of UniCredit Bank Czech Republic and Slovakia, commented on the results:

“Our business results are in line with the development of the banking sector’s profitability in an environment of low interest rates and yet, despite this fact, it exceeds market expectations. The most significant decline in revenues was recorded in trading on financial markets, which last year quarter was compared to this year's very strong. In the retail segment, we are continuing the dynamic development of new products and digital innovations in consumer financing, and this has been translated into clients’ demand and double-digit growth in loans and mortgages. The same pace is also maintained in lending to small and medium-sized enterprises. This year’s good start has also been reflected in more than 20 per cent increase in the financed value of vehicles provided by our leasing companies.”

Items of Profit and Loss Statement

The net interest income of UniCredit Bank Czech Republic and Slovakia was down to CZK 2,511 million (as of 31 March 2015: CZK 2,565 million). The net income from fees and commissions declined to CZK 925 million yoy (as of 31 March 2015: CZK 941 million).

The level of general administrative expenses rose by 24.7% to CZK 2,240 million (as of 31 March 2015:
CZK 1,796 million). After adjustment of costs to the Resolution Fund and to the Deposit Insurance Fund, is the annual increase in general administrative expenses 6%. The credit risk cost dropped to CZK 172 million yoy (as of 31 March 2015: CZK 346 million).

“In line with IFRS we booked the estimated costs for our contribution to the Resolution Fund and the Deposit Insurance Fund in 1Q 2016, hence the net profit is down 20.3%, adjusted the consolidated net profit dropped slightly, by 4.2%. Despite the persistent environment of low interest rates, we have maintained a solid base of net interest income and have succeeded in increasing the volume of transactions across all segments. Our credit risk cost was down to CZK 172 million, reflecting the soundness of our portfolio as well as strong macroeconomic environment. We further continue to grow both in loans and deposits.” said Gregor Hofstaetter-Pobst, CFO of UniCredit Bank.

Balance Sheet

In retail banking, consumer financing reported further strengthening. Retail loans posted double-digit growth, with mortgage loans increasing by 14% yoy and consumer loans rising by 12% yoy. The number of clients who use the free-of-charge U konto account with a 10-year guarantee of conditions amounted to 263,000. Over the last quarter there was an increase of almost 10%.

In the corporate segment, there was a 7% yoy growth in lending to small and medium-sized enterprises. Corporate banking deposits also reported a strong increase, almost by 20% yoy.

In the leasing companies, the financed value of vehicles for 1Q2016 grew by 19% compared to the same period in 2015. The strongest yoy percentage growth was reported in commodities by vehicles up to 3.5 tonnes (35%) and vehicles over 3.5 tonnes (20%).

As of 31 March 2016, total assets of UniCredit Bank Czech Republic and Slovakia amounted to CZK 625,650 million, representing a 16.5% increase compared to the figures as of 31 March 2015 (CZK 536,988 million).

On the assets side of the Balance Sheet, receivables from clients increased by 5.5% to a total of CZK 368,051 million compared to 31 March 2015 (CZK 348,970 million).

On the liabilities side, liabilities towards clients grew by 14.2% to CZK 374,870 million (31 March 2015: CZK 328,120 million). Liabilities from debt securities rose by 26.1% to CZK 63,310 million (31 March 2015: CZK 50,198 million).

Compared to 1Q2015, the bank’s equity was up 4.3% to CZK 63,277 million (as of 31 March 2015: CZK 60,671 million).