The performance of 28 commercial banks operating in Croatia in 2015 resulted in an aggregate gross loss of 4.7 billion kuna, which banks ascribed to conversion of Swiss franc-indexed loans. and nearly a half of that amount was made by one lender, Hypo Bank (HRK 2.2 billion), according to preliminary unaudited figures released by the Croatian National Bank (HNB).

This has been the first time for the banking system to finish a year in the red since 1998, which was remembered for a banking crisis when lenders had the aggregate gross loss of HRK 2.7 billion. 

However, in 2015, return on average assets (ROAA), an indicator used to assess the profitability of a bank's assets, was -1.2% as against -2.8% in 1998, and also the banking system's return on average equity (ROAE) was better last year, -8.3% as against -16.1% in 1998, the HNB said in response to Hina's queries.

According to HNB figures, as many as 15 credit institutions wrapped up 2015 with losses, and Hypo Alpe-Adria-Bank was the worst performer, being in the red by HRK 2.25 billion, which was a 47.5% share in the total gross loss of the banking sector. This bank said that the loss was on the back of the conversion and partly due to the internal restructuring. However, the bank's capital adequacy ratio was  above 22.66%.

Erste & Steiermaerkische incurred a loss of HRK 1.24 billion, and was followed by Zagrebacka Banka with its gross loss of HRK 662.3 million. The other three loss making lenders in 2015 were  Raiffeisenbank Austria (HRK 310.7 million), Sberbank (HRK 244.6 million), and OTP (HRK 156.5 million).

Those are six out of the eight credit institutions that had offered loans pegged to the Swiss franc on the Croatian market, and the legislation on the conversion of such loans into loans pegged to the euro or to the kuna, which went into force last year, forced them to cover substantial amounts of money for conversion costs.

For instance, respective unaudited financial statements show that Zagrebacka Banka had to earmark HRK 2.64 billion for conversion purposes, and Privredna Banka Zagreb HRK 1.31 billion.

On the other hand. the remaining two lenders that used to offer CHF-indexed loans - Privredna Banka Zagreb (PBZ) and Societe generale-Splitska Banka - realised gross profits of HRK 208 million and HRK 156.8 million respectively in 2015, and those profits were considerably lower than those in 2014 when they had HRK 820 million and HRK 250 million respectively.

Of 28 lenders, 13 wrapped up 2015 with gross profits, and apart PBZ and Splitska, the other 11 were Stedbanka (HRK 9.6 mln) , Banka Kovanica (HRK 9.5 mln), Kreditna Banka Zagreb (HRK 8.4 mln), BKS Bank (HRK 7.9 mln ), Croatia (HRK 5.9 mln), Podravska Banka (HRK 5.7 mln), Kentbank (HRK 3.9 mln), Partner (HRK 1.7 mln) and Primorska Banka (334,000 kuna).

The banking sector's assets were HRK 393.5 billion at the end of 2015, down by 0.43% compared to the end of 2014.

Zagrebacka Banka is still on the top of the rankings, with the value of its assets being nearly 106 billion kuna, 26.4% in total assets of the banking system.

Privredna Banka Zagreb follows with HRK 69.7 billion in assets, that is a 17.3 per cent share.


(EUR 1 = HRK 7.6)

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