Komercni Banka AS (KOMB), the Czech unit of France’s Societe Generale SA (GLE), said its second-quarter profit almost doubled as banking income advanced and it booked a one- time gain from the sale of a stake in a development bank.
Net income for the three-month period rose to 4.12 billion koruna ($199.6 million) from 2.1 billion koruna a year earlier, the Prague-based lender said in a statement published on its website today. That beat the 3.59 billion-koruna median estimate by 10 analysts in a Bloomberg survey. Net banking income rose 5 percent to 8.53 billion koruna.
“The results are helped by the one-off gain from the sale of the stake,” Cyrrus AS analyst Marek Hatlapatka said by phone today. “However, the cost of risk is lower than we projected and also higher banking income helped to boost the bottom line above market expectations.” Hatlapatka has a buy recommendation on the shares.
Komercni’s cost of risk totaled 352 million koruna, compared with 2.2 billion koruna a year earlier, the lender said. The lender said gross lending volume rose 8 percent to 456.2 billion koruna and its market share in loans continued to advance, driven by demand for mortgages and credit provided to corporate clients, Komercni said.
“The outlook for the banking industry points to momentous challenges ahead, especially due to the weakness in the European economy and unresolved Eurozone crisis,” Chief Executive Officer Henri Bonnet said in a separate statement. Komercni’s “strong balance sheet” and its efficiency will allow it to make the “most” from market opportunities, he said.
Komercni sold a 13 percent stake in state-controlled development lender Ceskomoravska Zarucni a Rozvojova Banka for 889.5 million koruna in May. Profit through last year was also hurt as the lender wrote off most of the Greek sovereign bonds it had in its portfolio.
Total operating costs were 3.32 billion koruna, compared with 3.4 billion koruna a year earlier.
Societe Generale, France’s second-largest bank, said today its second-quarter profit fell 42 percent, missing analysts’ estimates, after it took writedowns on its Russian unit and U.S. asset manager TCW Group.
The bank expects net banking income to grow 1 percent to 2 percent this year from the year before, Komercni Executive Director Pavel Cekja said today at a Prague press conference. Lending volume should grow 3 percent to 5 percent this year, he said.
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