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• Net Interest Income: 31% increase at the individual level; 23.6% increase at the consolidated level.

• Net Fees and Commission Income: 15.4% increase at the bank level; 14.7% increase at the consolidated level.

• Operating Expenses: 25% increase at the bank level; 26% increase at the consolidated level, primarily due to a new turnover tax.

• Net Profit: 42.6% increase at the bank level; 35% increase at the consolidated level.

• Net Interest Margin: 3.46% at the bank level; 4.6% at the consolidated level.

• Return on Equity (ROE): 31.5% growth.

• Cost-Income Ratio: 45%, a decrease of 2.26 percentage points from the previous year.

• Total Assets: Almost 5% increase at both individual and consolidated levels.

• Loans Growth: 4.9% increase at the bank level; 4.2% increase at the consolidated level.

• Deposits from Customers: 3.4% increase at the bank level; 3.3% increase at the consolidated level.

• Non-Performing Loans (NPL): 2.9% at the bank level.

• Capital Adequacy Ratio: 24% Tier 1 capital at the bank level; 23.3% at the group level.

• Loan to Deposit Ratio: 66.35%.

• New Clients: 46,000 new company clients and 250,000 new retail clients in the first six months.

• Transactions: Over 1 billion transactions in the first six months, a 40% increase from the previous year.

• Warning! GuruFocus has detected 4 Warning Sign with BSE:TLV.

Release Date: August 21, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Banca Transilvania SA (BSE:TLV) reported a 31% increase in net interest income at the individual level and a 23.6% increase at the consolidated level for the first half of 2024.

• The bank achieved a 15.4% growth in net fees and commission income, indicating strong customer engagement and transaction volumes.

• The bank's return on equity showed a significant growth of 31.5%, outperforming peers in the Romanian banking market.

• Banca Transilvania SA's non-performing loan ratio is at a comfortable level of 2.1%, below the local market average.

• The bank's capital adequacy ratio is robust, with a total capital ratio of 20% at the bank level and 26.5% at the group level, indicating strong financial stability.

Negative Points

• Operating expenses increased by 25% at the bank level and 26% at the consolidated level, driven by a new turnover tax and wage inflation.

• The cost of risk, although within guidance, showed a slight increase compared to last year, reflecting some pressure on asset quality.

• There is a slight increase in stage two loan provisions, particularly related to retail and large corporate customers, indicating potential risk concerns.

• The integration of OTP Bank is ongoing, with potential challenges in ensuring a smooth and timely integration process.

• The bank's net interest margin is expected to remain stable, with no significant increase anticipated, which may limit future profitability growth.