The top four Czech banks reported strong growth in 2019. The total profit of the four largest banks operating on the Czech market last year increased by 7.1 billion to CZK 62.2 billion. According to reports by ČSOB, Česká spořitelna, Komerční Banka, and UniCredit Bank ČR and SR.
The ČSOB group reported a net profit of CZK 19.7 billion, Komerční banka CZK 14.9 billion, and UniCredit Bank CR and SR CZK 9.9 billion. Česká spořitelna was the last to announce its results, which increased net profit by 15.5 percent to CZK 17.7 billion last year.
Ceska sporitelna grew by 15.5 percent year-on-year to Kc17.7bn last year. The bank’s operating profit increased by 8.6 percent to Kc22.5bn.
Net interest income grew by 8.8 percent year-on-year to CZK 30.3 billion. “The growth was caused by increasing client credit transactions and deposits and by the increase in interest rates by the Czech National Bank (CNB) during 2018 and 2019.”
ČSOB Group’s profit increased, among other things, thanks to higher net interest income. It also reported a one-off yield of CZK 2.1 billion, resulting from the revaluation of a 55 percent stake in the building society ČMSS. Last year, the volume of borrowed money grew by 5 percent to nearly 781 billion, while deposits increased by 3 percent to almost 960 billion.
Komerční banka’s total revenues grew by 1.1 percent to CZK 32.6 billion last year. This was due to higher net interest income, which rose year-on-year to CZK 23.6 billion thanks to the growth in the volume of loans and deposits.
At UniCredit Bank, the volume of deposits grew by 12 percent year on year to CZK 409 billion. The volume of loans increased by eight percent to CZK 436 billion. Net fee and commission income increased to CZK 3.9 billion year on year, while net interest income increased to CZK 14.3 billion.
Profits grew in most other banks except Moneta. Moneta Money Bank dropped its consolidated net profit by 4.3 percent to Kc4bn last year. However, its average profitability, or one-time adjusted profitability, increased by 13.4 percent last year. On the other hand, Air Bank reported a record net profit of CZK 1.5 billion last year, up 7% year on year. Last year, Raiffeisenbank rose its net profit by a quarter to CZK 4.2 billion.
National Development Fund
This year the National Development Fund is due to start operating. Its establishment was proposed last year by Prime Minister Andrej Babiš (ANO) instead of sectoral taxation of banks, which the CSSD pushed for. The fund is to focus on the financing of infrastructure projects, and banks will invest CZK 7 billion into it.
Banks have been criticized in the past for sending a large part of their profits to their foreign owners. The five largest banks operating in the Czech Republic sent roughly CZK 34 billion in dividends abroad last year. The Social Democrats proposed an annual sector tax of 0.3 percent of assets for banks with assets higher than CZK 300 billion.