Photo from Wikimedia
Hungary’s OTP Group, represented in Ukraine by OTP Bank, which is on the National Bank of Ukraine’s list of the largest banks in terms of assets, has no plans to withdraw from the Ukrainian market, despite significant losses being incurred at its Ukrainian subsidiary in 2014, the Group’s Chief Executive Officer Sandor Csanyi has said.
OTP Group expects to see a decrease in the losses of its subsidiary bank in Ukraine, and the group’s intentions to continue supporting the Ukrainian subsidiary are confirmed by its recapitalization plans, Csanyi said in a press statement from the bank.
In particular, in the first quarter, the bank's capital was increased by UAH 1.2 billion by converting subordinated debt into the capital, with the support of the shareholder, and in the second quarter it is planned to perform the prolongation of a sub-loan from the EBRD of $65 million and include this in the bank’s regulatory capital.
The group expects that in 2015 the losses of its Ukrainian subsidiary, which were caused by the realities of the Ukrainian market, will decrease, and the bank will implement a comprehensive program to optimize bank’s activities.
OTP Bank has been operating in the Ukrainian market since 1998. 100% of its shares are owned by OTP Bank, Hungary.
At the end of 2014, the Ukrainian subsidiary incurred losses of UAH 1.99 billion, which is believed to be a natural consequence of the events and conditions of operations in 2014, including losses in Crimea and the Anti-Terrorist Operation zone, and the writing off of lost assets, the impact of devaluation, and a deterioration in the quality of the loan portfolio.