Ukraine is not so bad as it may seem, says Hungarian OTP chief Csányi


The Board of Directors of Hungary's OTP Bank is proposing shareholders at the ongoing annual general meeting to approve retaining the 2008 profit and not to pay dividend from it. Chairman-CEO Sandor Csanyi said there are loans behind his OTP shares as well and he could have put the dividend to good use, as well. But from prudential reasons and because OTP wants to be ready for unexpected events, it is would be irresponsible to pay dividend this time. He also said Ukraine's woes are not as grave as the press suggests.

OTP Bank's three key foreign subsidiaries - in Russia, Ukraine and Bulgaria - performed well in 2008, Csanyi told the AGM on Friday. He also stressed Ukraine is not in such a bad shape as the press suggests it is.

The country is not indebted, the hryvnia has stabilised versus the US dollar and OTP runs the largest best bank in Ukraine with most of the clients paying back their loans on schedule, Csanyi said.

The corporate clientele is not concentrated and OTP is strong in the retail segment among wealthier customers. The Ukrainian unit has launched its programme against bad debtors quite on time and keeps doing its utmost not to have non-performing loans.

Csanyi said 2008 was the hardest year for OTP and hopes 2009 will not be as bad.

He stressed that OTP's capital adequacy ratio remained excellent. OTP posted HUF 241 bn profit last year or HUF 218 bn without one-offs.

Csanyi noted the share price does not reflect the results - it dropped 67% in 2008 back to 2002 levels.

He added that the best-performing unit in the OTP Group was DSK in Bulgaria. DSK is extremely efficient. It is so efficient, Csanyi said, that even OTP cannot find an explanation to that.