August 31st, 2010

MKB racks up Ft 52 billion loss in H1 as provisions grow

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MKB Bank had a consolidated pre-tax loss of HUF 52.4bn in the first half as risk provisions rose sharply, the bank reported on Monday.

Risk provisions grew to almost HUF 77.5bn in H1 from HUF 29.7bn in the same period a year earlier, when the bank had pre-tax profit of HUF 29.7bn, according to IFRS. Risk provisions were higher than planned because of the unfavourable outlook for the economic position of the region in the short term, the bank said.

CEO Tamas Erdei said prolonged exchange rate volatility in the past months as well as still sluggish capital investments and domestic consumption had had a negative effect on the quality of the bank’s lending portfolio. “At the same time, the bank’s operation continues to be stable and its capital and liquidity position exceeds the legal requirements,” he added.

MKB Bank’s operating costs rose 5.5pc to HUF 37.4bn in H1 from the same period a year earlier. Gross profit fell 13pc to HUF 63.4bn and operating profit dropped 31pc to HUF 26bn.

MKB Bank had consolidated total assets of HUF 3,236.3bn on June 30, 4.2pc more than at the end of December. Stock of client loans grew 1.9pc to almost HUF 2,314bn and deposit stock grew 8.4pc close to HUF 1,525bn.

Calculated with Hungarian Accounting Standards, MKB Bank’s pre-tax loss came to HUF 31.5bn in H1 after HUF 8.7bn in the red in H1 2009. Risk provisions grew to HUF 50.7bn from HUF 17.9bn.

MKB Bank is a unit of Germany’s BayernLB.

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  1. Rolrox says:
    August 31, 2010 at 3:57 pm

    Can this be a prelude to avoid the new banking tax?

  2. wolfi says:
    August 31, 2010 at 10:26 pm

    MKB’s parent Bavarian State Bank (Bayerische Landesbank) took a beating most of its losses are reported at MKB …

    Here’s the report (in German):

    http://www.sueddeutsche.de/v5p38r/3551613/Immer-Aerger-im-Ausland.html

    This is a typical exaple of how money-crazed bankers from state-owned companies try to expand business – just ignoring all risks.

    They are at the samelevel as those poor Hungarians who took out those Swiss Franc loans – but they don’t have to pay …

    Bastards!