MONETA Money Bank raises 2023 profit outlook (updated)

Moneta Money Bank, A.s

26/10/2023 08:54

(Adds comments on 2023, 2024 outlook, dividends, share price)
       PRAGUE, Oct 26 (Reuters) - 
    Czech lender MONETA Money Bank  MONET.PR  boosted its full
year outlook on Thursday, after reporting higher-than-expected
quarterly earnings as fee income rose by a quarter.
  
        Chief Executive Tomas Spurny said the bank aimed to
deliver net profit of 5 billion crowns ($214 million) this year,
adding that worries over a recession and weakening asset quality
had not materialised.
  
        MONETA previously guided for 2023 net profit of at least
4.7 billion crowns.
  
        Spurny also said the bank was "very well poised for
shareholder distributions next year" due to excess capital and
3.2 billion crowns accrued for future dividends.
  
        
    Third-quarter profit reached 1.49 billion crowns, above a
Reuters poll estimate of 1.25 billion crowns, and was at 4
billion crowns in the first nine months of the year.
    Third-quarter net banking income, at 3.18 billion crowns,
also beat estimates as fee income rose 26% to compensate for
falling net interest income.
    Net impairments at the bank, which has periodically sold
non-performing loan portfolios, were in line with forecasts.
    MONETA shares, which have climbed more than 13% since the
start of 2023, edged up 0.2% to 86.20 crowns in early Prague
trade. They slightly outperformed the wider Prague PX index
 .PX  which is up 11.8 so far this year.
    The Czech economy has stagnated this year amid high
inflation, which is forecast to ease back to the central bank's
target next year, allowing interest rate cuts from as early as
November, according to market pricing.
    The central bank has discontinued interest payments on
mandatory minimum reserves, and MONETA expects a negative impact
from that of 120 million crowns in the fourth quarter.
    Spurny said the impact in 2024 would be between 450 million
and 500 million crowns, and the bank was likely to lower its
2024 operating income outlook to a range of 12.3 billion to 12.4
billion crowns, from 12.8 billion crowns, as it reviews its
medium-term guidance.
        He said the operating costs forecast could be lowered
and the bank was assessing if its cost of risk outlook,
factoring provisioning, was too conservative. 
  
        Spurny said a net profit target of 4.8 billion crowns
for 2024 would not be changed.
  
    ($1 = 23.4180 Czech crowns)

 (Reporting by Jason Hovet; Editing by Sherry Jacob-Phillips and
John Stonestreet)
 ((jason.hovet@thomsonreuters.com;))