Bulletin: OTP Bank's Mid-Year Results Show Enduring Resilience As Ipoteka Integration Progresses

FRANKFURT (S&P Global Ratings) Aug. 10, 2023--S&P Global Ratings said today that the mid-year results of OTP Bank PLC (OTP; BBB-/Stable/A-3) underline the group's resilience as the integration with Uzbekistan-based Ipoteka Bank progresses in line with expectations. OTP's mid-year results support our base case. The bank's Hungarian forint (HUF) 577 billion (approximately €1.5 billion) half-year profit after tax in August 2023 represents a 1,252% increase from last year. The bank's increased profitability was driven by a higher net interest income, contained administrative costs amid a highly inflationary environment, and a reversal of loan loss provisions. Several one-off items also had a positive impact, including: The recognition of Ipoteka's badwill, amounting to HUF125 billion; and A HUF25.6 billion write-back of Hungary's

...FRANKFURT (S&P Global Ratings) Aug. 10, 2023--S&P Global Ratings said today that the mid-year results of OTP Bank PLC (OTP; ###-/Stable/A-3) underline the group's resilience as the integration with Uzbekistan-based Ipoteka Bank progresses in line with expectations. OTP's mid-year results support our base case. The bank's Hungarian forint (HUF) 577 billion (approximately 1.5 billion) half-year profit after tax in August 2023 represents a 1,252% increase from last year. The bank's increased profitability was driven by a higher net interest income, contained administrative costs amid a highly inflationary environment, and a reversal of loan loss provisions. Several one-off items also had a positive impact, including: - The recognition of Ipoteka's badwill, amounting to HUF125 billion; and - A HUF25.6 billion write-back of Hungary's windfall tax, pursuant to a regulatory change in April 2023. At the same time, we expect government intervention to continue to pose a risk in the Hungarian banking...

Bulletin