Otp Bank Nyrt · BET:OTP
Otp Bank Nyrt — Otp Bank S/Adr R — Q1 2025 Earnings Presentation
33 slides from Otp Bank Nyrt's earnings presentation, May 9, 2025
Slide 1: OTP Group 1Q 2025 results
OTP Group 1Q 2025 results Conference call – 9 May 2025 Péter Csányi, Chief Executive Officer László Bencsik, Chief Financial and Strategic Officer
Slide 2: Péter Csányi was appointed as new CEO of OTP Bank
Péter Csányi was appointed as new CEO of OTP Bank Career at OTP Deputy CEO, member of the Board of Directors and Head of the Digital Division since 2021, and Chairman of the Supervisory Board of OTP banka d.d. (Croatia) since 2020. Joined OTP in 2016 and held various managing positions such as Head
Slide 3: Chairman and CEO roles are now separated, with the Chairman remaining in full-time executive position
Chairman and CEO roles are now separated, with the Chairman remaining in full-time executive position Responsibilities and roles of the Chairman and CEO Chairman (Dr. Sándor Csányi) CEO (Péter Csányi) Remains employed in full-time executive position Responsible for managing the operative, day-to-day
Slide 4: The long-term strategy remains the same with four focus areas to further improve
The long-term strategy remains the same with four focus areas to further improve The long-term strategy is unchanged GROWTH PROFITABILITY STABILITY Focus areas to further improve Enhancing client experience, including beyond banking Client experience products and services Improving cost efficiency t
Slide 5: New management members have been appointed in key fields
New management members have been appointed in key fields András Sebők Péter Juhász András Hámori Head of Head of Marketing CEO candidate1 of Digital Division and Communication OTP Bank Slovenia Strong international experience Most awarded marketing Seasoned retail banking supporting clients across e
Slide 6: OTP Group is among the most successful banks in Europe
OTP Group is among the most successful banks in Europe Dominant position in CEE countries: Dominant position in 5 countries; 4.1-fold loan growth and 14 acquisitions in 10 years. 43% of net loans in Eurozone + ERM II countries, 75% within the EU Outstanding profitability: After 23.5% ROE in 2024, in
Slide 7: In 1Q 2025 OTP Group's profit after tax was heavily influenced by the lump-sum recognition of special taxes
In 1Q 2025 OTP Group’s profit after tax was heavily influenced by the lump-sum recognition of the full annual amount of Hungarian special taxes and supervisory charges. Margin remained stable, cost efficiency improved q-o-q Consolidated profit after tax Key performance indicators of OTP Group (HUF b
Slide 8: Special items booked in one sum in 1Q for the whole year reached HUF 135 billion
Special items booked in one sum in 1Q for the whole year reached HUF 135 billion. Had these items been booked evenly throughout the year, the 1Q profit would have been HUF 110 billion higher with the ROE even exceeding last year’s level Return on equity (%) Reported 1Q 2025 189 profit after tax 23.5
Slide 9: OTP Core suffered losses in 1Q 2025 as the full annual amount of special taxes are booked in a lump sum
OTP Core suffered losses in 1Q 2025 as the full annual amount of special taxes are booked in a lump sum at the OTP CORE beginning of each year. Special taxes are set to grow in 2025 OTP Core profit after tax Key performance indicators of OTP Core (without dividends received from subsidiaries, HUF bi
Slide 10: In 1Q 2025 mortgage loan contractual amounts kept on increasing and cash loan sales soared by 43%
In 1Q 2025 mortgage loan contractual amounts kept on increasing and cash loan sales soared by 43%. OTP is OTP CORE an active participant in the workers’ loan program. Our market share in household deposits improved further Y-o-y change in mortgage loan contractual amounts in 1Q 2025 Y-o-y change in
Slide 11: The demand for corporate and MSE loans started to pick up
The demand for corporate and MSE loans started to pick up. OTP’s corporate credit market share q-o-q OTP CORE increased Performing corporate loan volume changes (%) OTP Group’s market share in loans to Hungarian (DPD0-90 loan changes until 2018, Stage 1+2 from 2019, FX-adjusted) companies2 (%) 20.0
Slide 12: In 1Q 2025 foreign subsidiaries continued to deliver strong results
In 1Q 2025 foreign subsidiaries continued to deliver strong results Profit after tax1 (HUF billion) ROE1 Cost / income ratio 1Q 2024 1Q 2025 1Q 2024 2024 1Q 2025 1Q 2024 2024 1Q 2025 DSK Group 39% 43 49 19% 22% 19% 41% 32% (Bulgaria) OTP Bank Slovenia 26 28 15% 16% 14% 45% 42% 47% OTP Bank Croatia 1
Slide 13: The consolidated net interest margin remained stable both in q-o-q and y-o-y comparison
The consolidated net interest margin remained stable both in q-o-q and y-o-y comparison. Sensitivity to EUR rate cuts has moderated significantly in the last several quarters Drivers behind the q-o-q change of the consolidated net interest margin Sensitivity to rate changes 4.27% -2 bps 4 bps 4.27%
Slide 14: Consolidated performing loans increased by 3% q-o-q (FX-adjusted)
Consolidated performing loans increased by 3% q-o-q (FX-adjusted), demonstrating a balanced composition among retail and corporate. Ipoteka was still lagging behind in the Uzbek consumer lending market Q-o-Q performing (Stage 1+2) LOAN volume changes, adjusted for FX effect Cons. Core2 DSK OBS OBH O
Slide 15: Consolidated deposits grew by 3% q-o-q
Consolidated deposits grew by 3% q-o-q. The increasing trend of Hungarian household deposits continued, their stock grew by 6%. Outflows in Uzbekistan were driven partly by seasonality and a withdrawal by a large corporate client Q-o-Q DEPOSIT volume changes, adjusted for FX-effect Cons. Core DSK OB
Slide 16: The Stage 3 ratio decreased to 3.5%
The Stage 3 ratio decreased to 3.5%. Provisioning policy remained conservative compared to regional peers Development of the Group's main credit Own coverage of Stage 1+2 loans compared to regional peers quality indicators at the end of 1Q 2025 80.4% 81.5% 83.4% 82.7% 83.3% 83.8% 1.9% 1.4% Stage 1 1
Slide 17: In 1Q 2025 the Group's CET1 ratio decreased to 18% mainly due to the Basel IV impact
In 1Q 2025 the Group’s CET1 ratio decreased to 18% mainly due to the -86 bps Basel IV impact Capital adequacy Regulatory Decomposition of the ytd change in the CET1 ratio and MREL ratios (%)1 requirements 2 (based on the prudential scope of consolidation, % / changes in percentage points) MREL ratio
Slide 18: In 2025 the Group's capital ratios will be drawn down by an additional 84 bps
In 2025 the Group’s capital ratios will be drawn down by an additional 84 bps due to the elimination of transitional adjustments and the recently announced share buyback Loaded CET1 = Tier 1 ratio of OTP Group Peer comparison of capital adequacy and leverage ratios (1Q 2025, %) (1Q 2025, %) CET1 rat
Slide 19: Robust liquidity position: 73% net loan to deposit ratio, 238% LCR, 151% NSFR
Robust liquidity position: 73% net loan to deposit ratio, 238% LCR, 151% NSFR and comfortable redemption profile OTP Bank outstanding and recently redeemed FX wholesale bonds OTP Bank FX MREL-eligible bond maturity profile2 Issued Amt. / 1Q 2025 (in EUR million) Issue Maturity Actual Issuance Instru
Slide 20: Management reaffirms its guidance for the Group's 2025 performance
Management reaffirms its guidance for the Group’s 2025 performance In 2025 the management expects marginal improvement in the operating environment. 2024 1Q 2025 1Q 2025 Therefore: audited reported adjusted FX-adjusted organic performing loan volume growth may be above 9% reported in 2024. 9% 3% 3%
Slide 21: Our upcoming NDRS next week is a unique opportunity to meet OTP Bank's new CEO
Our upcoming NDRS next week is a unique opportunity to meet OTP Bank’s new CEO Non-Deal Roadshow details: All meetings arranged by J.P. Morgan Date: 14-16 May 2025 Including in person meetings in London in roadshow format as well as in J.P. Morgan offices Combined with virtual calls with investors f
Slide 22: Cross sections and detailed financials
Cross sections and detailed financials 22
Slide 23: Operating profit increased by 20% y-o-y organically and FX-adjusted
Operating profit increased by 20% y-o-y organically and FX-adjusted Q-o-Q Y-o-Y Consolidated P&L (in HUF billion) 2024 1Q 2024 4Q 2024 1Q 2025 FX-adj. FX-adj. w/o OBR Net interest income 1.783 435 461 465 0% 8% Net fees and commissions 546 121 148 139 -7% 14% Other net non-interest income 306 41 97
Slide 24: Net interest income advanced by 8% y-o-y organically and FX-adjusted
Sale of Net interest income advanced by 8% y-o-y organically and FX-adjusted Romania NET INTEREST 1Q 2024 4Q 2024 1Q 2025 1Q 2025 Y-o-Y 1Q 2025 Q-o-Q INCOME (HUF billion) (HUF billion) (HUF billion) (HUF billion) (HUF billion) 1 The 11% y-o-y growth at OTP Group 465 435 461 465 441 30 7%/8%1 5 1%/0%
Slide 25: Consolidated net interest margin remained stable
Consolidated net interest margin remained stable NET INTEREST 1 1Q 2024 4Q 2024 1Q 2025 At OTP Core the margin remained MARGIN stable q-o-q, as the positive impact of increasing retail deposits was offset, OTP Group 4.30% 4.27% among others, by the additional 4.27% interest expenditure incurred in t
Slide 26: Consolidated performing loans grew by 11% y-o-y organically and FX-adjusted
Consolidated performing loans grew by 11% y-o-y organically and FX-adjusted, driven by retail loans, but corporate loan volume growth also gained momentum. Ukrainian credit volumes expanded by 25% Y-o-Y performing (Stage 1+2) LOAN volume changes, adjusted for FX effect Cons. Core2 DSK OBS OBH OBSrb
Slide 27: Consolidated deposits increased by 9% y-o-y organically and FX-adjusted
Consolidated deposits increased by 9% y-o-y organically and FX-adjusted. Hungarian household deposits grew by 12%. Uzbek deposits expanded by 43% y-o-y Y-o-Y DEPOSIT volume changes, adjusted for FX-effect Cons. Core DSK OBS OBH OBSrb Ipoteka OBU CKB OBA OBM OBRu (Hungary) (Bulgaria) (Slovenia) (Croa
Slide 28: Net fee income went up by 14% y-o-y organically and FX-adjusted
Net fee income went up by 14% y-o-y organically and FX-adjusted, while the quarterly drop was induced Sale of mainly by one-offs in Hungary and seasonality Romania NET FEE 1Q 2024 4Q 2024 1Q 2025 1Q 2025 Y-o-Y 1Q 2025 Q-o-Q 1 At OTP Core the 10% y-o-y increase INCOME (HUF billion) (HUF billion) (HUF
Slide 29: Other income moderated q-o-q on lower fair value adjustment of subsidized retail loans
Sale of Other income moderated q-o-q on the back of lower fair value adjustment of subsidized retail loans in Hungary Romania 1Q 2024 4Q 2024 1Q 2025 1Q 2025 Y-o-Y 1Q 2025 Q-o-Q OTHER INCOME (HUF billion) (HUF billion) (HUF billion) (HUF billion) (HUF billion) OTP Group 41 97 85 461 44 107%/108%1 -1
Slide 30: Operating costs increased by 10% y-o-y organically and FX-adjusted
Operating costs increased by 10% y-o-y organically and FX-adjusted 9M 2023 1Q 2025 Y-o-Y Y-o-Y, FX-adjusted OPERATING COSTS (HUF (HUF billion) billion) (HUF billion) (HUF billion) 1 At OTP Core operating expenses increased by 13% as a joint result of strong OTP Group 282 321 18 7%/13%1 261 12 4%/10%
Slide 31: In 1Q 2025 the credit risk cost rate of 40 bps was slightly above the 38 bps posted in 2024
In 1Q 2025 the credit risk cost rate of 40 bps was slightly above the 38 bps posted in 2024. In 1Q further impairments were created for the Russian government bonds, as a result of which their coverage ratio increased to 74% 2024 2024 1Q 2024 4Q 2024 1Q 2025 1Q 2025 TOTAL RISK COST credit risk credi
Slide 32: Disclaimers and contacts
Disclaimers and contacts This presentation contains statements that are, or may be deemed to be, “forward-looking statements” which are prospective in nature. These forward- looking statements may be identified by the use of forward-looking terminology, or the negative thereof such as “plans", "expe
Slide 33: Questions and Answers session
Questions and Answers session 33