Russia’s largest majority state-owned banks, Sberbank and VTB, have once again come in first and second place, respectively, among the top 25 banks by Tier 1 capital table for central and eastern Europe (CEE) – positions they both have held for well over a decade. Sberbank improved its Tier 1 capital base by almost 8%, to $78.63bn, while VTB’s Tier 1 decreased by 12% to $21.77bn.
Sanctions imposed against Russian banks saw most of the country’s leading lenders’ profitability impacted in 2022, with VTB posting a $11.3bn loss in 2022 and Sberbank seeing its profits shrink by 71.4%.
The reporting of Russian banking sector data was curtailed last year as a sanction-proofing measure by the Russian central bank, which led to a dramatic fall in the number of banks in the 2022 ranking. However, eight Russian banks have returned to the Top 1000 World Banks ranking this year.
Hungarian banks have made their presence felt this year, with OTP Bank, the country’s largest lender, rising from sixth to third place in the top 25 table for CEE. This is despite OTP’s Tier 1 falling 2.9%, to $8.73bn, due to a strong US dollar, the currency in which the ranking is denominated.
MBH Bank, the country’s new “megabank” following a triple merger between Budapest Bank, MKB Bank and savings group Takarékbank, is the highest mover in the CEE, with its Tier 1 capital expanding by a whopping 205.5%, to $1.98bn.
The legal merger of Budapest Bank and MKB Bank was finalised in March 2022, while the merger between MKB Bank and Takarékbank was completed in April this year. The megabank is now the second-largest banking group in Hungary behind OTP.
Other banks in the highest movers table by percentage in the region include: Bank of Georgia, which saw an almost 45% increase in Tier 1; the Czech Republic’s J&T Banka, which boosted its Tier 1 by more than 33%; and another Georgian lender, TBC Bank, which saw its Tier 1 jump by 31.6%.
Ukraine’s largest bank, PrivatBank, which was recapitalised by the Ukrainian government and nationalised in 2016, saw the highest return on capital (ROC) ratio, of 53.5%, in this year’s CEE rankings. It has also ranked second in return on assets (ROA) with a ratio of 5.6%, just behind Russia’s Bank Saint Petersburg with an ROA ratio of 5.7%.
Bank of Georgia has come second in ROC, with a ratio of 42.62%, and third for ROA at 5%. Bank Saint Petersburg places third for ROC (29.59%) and TBC Bank has taken fourth place with an ROC of 25.9%. The latter also finished fourth in ROA (3.46%). Romania’s Banca Transilvania fills out the ROC table in fifth position with a ratio of 22.37%.
Poland is also well represented in the top 25 banks by Tier 1 capital in the CEE region, with a total of four banks. PKO Bank Polski has moved up one to fourth position in this year’s rankings, despite its Tier 1 capital dropping by 8.65%, to $8.67bn. Another Polish lender, Bank Gospodarstwa Krajowego has also moved up one place, to sixth, with a 9.1% increase in Tier 1.
