In H1 2023, Banca Transilvania recorded net interest income growth of 25% YoY, net fee and commission income growth of 10%, op. income growth of 30%, and a net income to majority of RON 1.52bn, an increase of 51% YoY.
Starting off with the net interest income, it amounted to RON 2.52bn, an increase of 24.5% YoY. This was boosted by higher market rates (3M and 6M ROBOR average at app. 7% in H1 2023), as well as the higher loan volume production (+1.9% increase compared to YE 2022). Net fee and commission income increased by 10% YoY and amounted to RON 606.7m, supported by the higher number of transactions, with net revenues from transactions increasing by 15% YoY. Overall, this resulted in a 29.7% improvement in the operating income, amounting to RON 3.68bn.
Moving on to operating expenses, they increased by 6.7% YoY and amounted to RON 1.74bn. Breaking this down further, in H1 2023, there release of provisions for financial assets measured at fair value through P&L, which dropped by 72% YoY to RON 57.6m, positively influencing OPEX, other provisions also reduced by 61% to RON 10m. On the other hand, personnel expenses increased by 19.7% to RON 979.4m, which was both due to an increase in the employee base (+1.7% YoY), and also due to the high inflation rate. Depreciation and amortization also increased, growing by 15.8% YoY to RON 218.3m, and finally, other operating expenses grew by 11.3% to RON 496.7m.
Because of these positive developments, the net profit to majority also recorded a significant increase, growing by 51.2% to RON 1.52bn. In terms of some other KPIs, the cost of risk remained negative at -5 bps, the cost-to-income ratio amounted to 47.3%, the capital adequacy ratio stood at 23.88%, and finally, the NPL ratio stood at 2.36%.
Banca Transilvania key financials (H1 2023 vs. H1 2022, RONm)
Source: Banca Transilvania, InterCapital Research
Taking a quick look at the balance sheet, the total assets grew by 9% YoY and amounted to RON 153.1bn. This was supported by higher cash and current accounts with the Central Banks, which grew by 57% YoY and amounted to RON 22.8bn, which due to the interest rates currently offered (between 6% and 8%), is expected. Growth was also supported by debt instruments (RON 4.34bn, +111% YoY,), financial assets measured at fair value through OCI (RON 45.67bn, +5% YoY), and finally, loans and advances to customers (RON 66.5bn, +2% YoY). Moving on to the passive side of the balance sheet, the total liabilities amounted to RON 140.8bn, an increase of 7%, or RON 9.74bn YoY. This was mainly supported by higher deposits from customers, which increased by 6%, or RON 7.69bn YoY, and amounted to RON 127.4bn. Loans from banks and other financial institutions also increased, growing by 36%, or RON 1.72bn YoY, and amounted to RON 6.56bn. On the other hand, deposits from banks decreased by 73%, or RON 1.22bn YoY, and amounted to RON 453.5m.
Banca Transilvania also recently proposed a dividend payment of RON 1.13 DPS, with a DY of 5.5%. If you would like to read more about this news, click here.
