ZABA published their FY 2019 results yesterday, showing a flat net income from banking activities which amounted to HRK 4.9bn. Meanwhile net profit went down 13.8% YoY to HRK 1.8bn.
In FY 2019 ZABA recorded HRK 3.5bn in net interest income which represents an increase of 1.3% YoY. The increase came as a result of changes in the balance sheet structure, combined with a stable average loan volume and lower costs of financing. Meanwhile, net income from fees and commissions went down by 1.2% YoY to HRK 1.4bn. Net trading income and other income plummeted to HRK 359m (-29.3% YoY) due to one-offs expenses.
Going further down the P&L, operating expenses are down 1.4% YoY, amounting to HRK 2.3bn. As a result, CIR stands at 44.6%, which represents a decrease of 2.7 p.p. YoY.
A major influence on ZABA’s bottom line performance were large expenses for value adjustments and provisions, totalling HRK 809.9m. Of that, provisions account for HRK 443.8m, which is 5 times higher compared to last year. Such a high increase can be attributed to higher provisions for lawsuits to (former) debtors on loans in Swiss francs.
Finally, net profit went down by 13.8% YoY to HRK 1.8bn as a result of one-offs and higher provisions.
Turning our attention to the balance sheet, total assets amounted to HRK 145.6bn, representing an increase of 5.1% YoY. Of that loans to customers amount to HRK 83.38bn, which represents a 2.3% YoY increase, mostly due to the increase of loans issued to retail clients.
Deposits from customers saw a 10.6% YoY increase, amounting to HRK 113.31bn, while deposits to other financial institutions fell 39.2% YoY to HRK 8.26bn. Consequently, L/D ratio stands at 68.6%.
ZABA’s Key Financials (HRK m)
Ericsson NT announced yesterday that they are taking over the full responsibility for building and maintaining HT’s telecommunications infrastructure from their parent company.
In a statement released yesterday on the Zagreb Stock Exchange, Ericsson NT announced that the Group will be taking over full responsibility for the Managed Services of build and maintenance of HT’s telecommunications infrastructure. The responsibilities carried down from the parent company are based on the contract which was signed in 2014 and runs until September 2020.
As a reminder, back in 2014, the global Ericsson signed a collaboration contract with HT in the managed services segment. As part of that collaboration Ericsson NT’s newly founded daughter company had to provide maintenance of HT fixed and mobile network in the next 5 years. This business was recorded under the Ericsson market and Ericsson NT was a sub-contractor for global Ericsson.