In 2019, HPB recorded an increase in net banking income of 10.8% and a decrease in net profit of 9%.

Hrvatska Poštanska Banka (HPB) published their FY 2019 results. According to the report, net interest income observed an increase of 1.2%, amounting to HRK 545.5m. Such an increase could be attributed to the solid loan growth in 2019.

Net fee and commission income observed a slight increase of 0.8%, amounting to HRK 214m. Meanwhile net banking income observed a high increase of 10.8%, amounting to HRK 842.6m. Such a high increase of net banking income could mainly be attributed to gains from financial assets held for trading which went up by HRK 59.4m. Although the bank does not give much explanation in their report to why this item went up, one can assume that such a rise came from an increase in pricing of debt securities.

Operating expenses of the bank amounted to HRK 548.2m, representing a solid increase of 9.2% YoY. Such an increase mostly came on the back of higher amortization (+67% or HRK 31m) coupled with a rise in administrative expenses by 3% or HRK 11.79m.  As a result, CIR stood at 62.6% (-2.2. p.p. YoY), which is still a bit higher compared to other regional banks.

In 2019, provisions recorded a sharp increase from HRK -16.2m to HRK 81.8m. Such a high rise came solely in Q4 when bank recorded provisions of HRK 91.65m, which resulted in a lower performance of the bottom line.

When observing net profit, one can notice that HPB recorded a decrease of 9%, amounting to HRK 141.97m.

Turning our attention to the balance sheet, as of end 2019, the company operates with total assets of HRK 22.84bn (+3.2% YoY). Of that, loans to customers account for roughly 64%, which observed strong growth of 12.5% or HRK 1.7bn. On the liabilities side, deposits amounted to HRK 20.94bn (+0.8%), accounting for 97.5% of the total liabilities. As a result of such a high loan growth L/D ratio decreased by 7.6 p.p. and stood at 73%.