PRAGUE, May 3 (Reuters) - Komercni Banka, the third largest Czech lender, posted a 6 percent rise in first-quarter profit on strong growth in net interest income, although earnings slightly missed expectations as net fees dropped.
Attributable net profit rose to 3.18 billion crowns ($138.3 million), fuelled by a 9 percent increase in net interest income due to rising Czech rates.
However, the result was below the average estimate of 3.26 billion crowns in a Reuters poll, while reported net interest income of 5.89 billion crowns also slightly lagged estimates.
Net fee and commission income dropped 2.1 percent to 1.43 billion crowns, against expectations for flat income, as transaction fees fell.
Komercni Banka, which is 60 percent owned by France’s Societe Generale, said it booked a net release of provisions for credit risk of 176 million crowns in the quarter, boosting gains.
Risk costs for Czech banks have fallen in recent years as the economy has posted solid growth and unemployment has hit new lows, helping to push up wages.
Komercni Banka’s lending grew 4 percent in the quarter, in line with company guidance.
Housing loan sales volume dropped 27 percent year-on-year, hit by Czech National Bank calls in the fourth quarter to tighten income requirements for loans in an effort to tame a hot real estate market. ($1 = 22.9960 Czech crowns) (Reporting by Jason Hovet; Editing by Sonali Paul)