Komercni Banka beats Q1 profit estimates after provisions release

Komercni Banka as

30/04/2025 07:33

PRAGUE, April 30 (Reuters) - Czech lender Komercni Banka BKOM.PR reported a 49% year-on-year rise in first-quarter net profit on Wednesday, beating estimates after a release of loan loss provisions.

Net banking income for the country's third-largest bank grew less than expected and Komercni Banka scaled back its outlook for full-year revenue growth.

In the quarter, attributable net profit increased to 4.19 billion crowns ($191.42 million), above the average estimate of 3.69 billion crowns.

Revenue rose 3.5% to 9.14 billion crowns, below a poll estimate of 9.35 billion crowns. Net interest income rose 2.0%.

The bank's cost of risk reached a negative 0.5 billion crowns after the net release of provisions, mainly related to a large corporate exposure, the bank said. Analysts had expected a slight net creation of provisions in the quarter.

Komercni Banka, majority owned by France's Societe Generale SOGN.PA, said risk costs should stay low in 2025 despite economic and geopolitical risks.

Revenues should grow at a mid-single-digit pace this year, it added, after previously expecting high-single-digit growth.

"The economic environment was more volatile in the first quarter of this year, with news of a new fiscal stimulus package in Europe together with plans for the introduction of protectionist measures by the United States," Chief Executive Jan Juchelka said.

"This information has had an impact on customer decision-making, particularly with regard to investment and hedging."

The Czech economy has been recovering behind rising household demand while firms face thin order books. The central bank has been cutting interest rates since 2023 but is taking a cautious approach to further easing of borrowing costs.

Komercni Banka said it expected lending this year to grow at a mid-single-digit rate. Lending was up nearly 3% in the quarter.

($1 = 21.8890 Czech crowns)

 (Reporting by Jason Hovet, Editing by Louise Heavens)

 ((jason.hovet@thomsonreuters.com;))