The largest domestic bank, in terms of the number of clients, fell by half to 4.6 billion crowns. Česká spořitelna, owned by the Austrian Erste Bank, published its results for the first half of this year, to which the coronavirus trap, which has gripped the entire Czech economy, is already making a significant contribution.
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The decline in profit (by exactly 47.1 percent) roughly corresponds to the reports that other large domestic companies published about themselves this week. Česká spořitelna does not differ in this and it turns out that the decline in the frozen economy, quarantine, and the related decline in demand for goods and services, are approximately the same in the affected sectors – ie dramatically.
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However, Česká spořitelna also mentions one positive dimension in its results for the first half of the year. “The good news is that despite the decline in economic activity in the market, which is the fault of the covid-19, the volume of loans provided to us increased by 4.6% year-on-year. We provided more financial resources to citizens, mainly in the form of housing loans (the volume of mortgages increased by CZK 23.7 billion year-on-year), “commented Tomáš Salomon, Chairman of the Board of Directors of Česká spořitelna.
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The financial group Erste Group Bank, to which the savings bank belongs, lost 60 percent of its profit due to coronavirus and earned about 7.7 billion crowns in the first half of the year.
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Banks seem to expect the effects of the coronavirus crisis to be long-lasting. The macroeconomic environment of the Czech Republic has significantly deteriorated due to the covid-19 pandemic, said Česká spořitelna.
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Erste has increased its loan loss provisions to EUR 614 million, the highest in almost six years. On the other hand, the shareholder (Erste shares are also traded on the Prague Stock Exchange) pleased her by promising to return the dividend. It is determined to pay it for both 2019 and 2020, if the central banks remove the blanket recommendation to delay the payment of dividends.
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