OTP Bank (OTP) Q2 2026 earnings summary

Executive summary

• Adjusted profit after tax for 1H 2026 was HUF 580.3 billion, with reported profit after tax at HUF 482.7 billion, reflecting a 7% year-over-year decline due to special items, including windfall and banking taxes.

• FX-adjusted performing loan volumes increased by 8% year-over-year, with normalized ROE at 21% and strong liquidity and capital positions maintained.

• Net interest income grew 19% year-over-year (FX-adjusted), driven by organic loan growth and improved margins.

• Announced acquisition of Luminor Bank, expected to increase total assets by 13% and net Eurozone loan exposure to 50%, entering three new Eurozone markets.

• Special items, including Hungarian windfall taxes and interest rate caps, significantly impacted profitability.

Financial highlights

• Net interest income up 19% year-over-year (FX-adjusted); total income up 10%; net fees and commissions up 3% (FX-adjusted); other income down 21%.

• Operating expenses increased 17% (FX-adjusted), outpacing total income growth; cost/income ratio at 41.4–42.0%.

• Adjusted profit after tax for 1H 2026 was HUF 580.3 billion, down 2% year-over-year; reported profit after tax was HUF 482.7 billion, down 7%.

• Stage 3 ratio improved to 3.2%; credit risk cost rate at 76 bps; risk cost rate for European countries at 42 bps, but only 21 bps excluding Russia, Ukraine, and Uzbekistan.

• EPS (diluted, adjusted) was HUF 1,901 for 1H 2026, down 5% year-over-year.

Outlook and guidance

• Management expects full-year net interest margin to exceed 2025’s 4.34%.

• FX-adjusted organic performing loan volume growth may be around 15%; cost/income ratio expected to be slightly higher than 2025.

• ROE expected to be lower than 2025 due to reduced leverage; credit risk profile and risk cost rate should remain similar to 2025.

• Windfall tax in Hungary expected to start declining next year and potentially phase out over three years.

• Continued issuance of benchmark-sized MREL-eligible and covered bonds planned.