OTP Bank : 3 months ended March 31, 2024, IFRS separate, condensed

OTP BANK PLC.

SEPARATE FINANCIAL STATEMENTS

IN ACCORDANCE WITH

INTERNATIONAL FINANCIAL REPORTING STANDARDS

AS ADOPTED BY THE EUROPEAN UNION

FOR THE THREE MONTH PERIOD

ENDED 31 MARCH 2024

	OTP BANK PLC.
	CONTENTS
SEPARATE STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2024	3
SEPARATE CONDENSED STATEMENT OF PROFIT OR LOSS FOR THE THREE MONTH PERIOD
	ENDED 31 MARCH 2024 (UNAUDITED) (in HUF mn)	4
SEPARATE CONDENSED STATEMENT OF COMPREHENSIVE INCOME FOR THE THREE
	MONTH PERIOD ENDED 31 MARCH 2024 (UNAUDITED) (in HUF mn)	5
SEPARATE STATEMENT OF CHANGES IN EQUITY FOR THE THREE MONTH PERIOD ENDED
	31 MARCH 2024 (UNAUDITED) (in HUF mn)	6
SEPARATE CONDENSED STATEMENT OF CASH FLOWS FOR THE THREE MONTH PERIOD
	ENDED 31 MARCH 2024 (UNAUDITED)	7
NOTE 1:	ORGANIZATION AND BASIS OF FINANCIAL STATEMENTS	8
1.1.	General information	8
1.2.	Accounting	8
NOTE 2:	SIGNIFICANT EVENTS DURING THE THREE MONTH PERIOD ENDED
	31 MARCH 2024	8
NOTE 3:	SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD	8
NOTE 4:	FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS (in HUF mn)	9
NOTE 5:	SECURITIES AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME (in
	HUF mn)	9
NOTE 6:	SECURITIES AT AMORTISED COST (in HUF mn)	10
NOTE 7:	LOANS (in HUF mn)	10
NOTE 7:	LOANS (in HUF mn) [continued]	11
NOTE 8:	INVESTMENTS IN SUBSIDIARIES, ASSOCIATES, JOINT VENTURES AND OTHER
	INVESTMENTS (in HUF mn)	11
NOTE 9:	DEPOSITS FROM CUSTOMERS (in HUF mn)	12
NOTE 10:	LIABILITIES FROM ISSUED SECURITIES (in HUF mn)	12
NOTE 11:	OFF-BALANCE SHEET ITEMS (in HUF mn)	13
NOTE 12:	DERIVATIVE FINANCIAL INSTRUMENTS (in HUF mn)	14
NOTE 13:	INTEREST INCOME AND EXPENSES (in HUF mn)	17

OTP Bank Plc Separate Condensed Financial Statements 2024Q1

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OTP BANK PLC.

SEPARATE STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2024

(in HUF mn)

		31 March	31 December	31 March
	Note	2024	2023	2023
Cash, amounts due from banks and balances with the National Bank
of Hungary		2,462,289	2,708,232	2,404,253
Placements with other banks		2,670,413	2,702,433	2,418,835
Repo receivables		216,136	201,658	241,712
Financial assets at fair value through profit or loss	4.	269,432	257,535	357,692
Financial assets at fair value through other comprehensive income	5.	580,520	559,527	730,992
Securities at amortised cost	6.	4,128,083	2,710,848	3,105,610
Loans at amortised cost	7.	4,770,564	4,681,359	4,731,784
Loans mandatorily measured at fair value through profit or loss	7.	946,123	934,848	809,463
Investments in subsidiaries	8.	2,039,164	2,001,952	1,894,708
Property and equipment		107,590	107,306	94,237
Intangible assets		99,296	98,115	69,261
Right of use assets		65,912	66,222	40,706
Investment properties		4,293	4,203	4,193
Deferred tax assets		-	408	35,854
Current tax assets		-	-	2,250
Derivative financial assets designated as hedge accounting
relationships		21,404	21,628	44,592
Non-current assets held for sale		130,718	130,718	-
Other assets		561,348	365,961	676,194
TOTAL ASSETS		19,073,285	17,552,953	17,662,336
Amounts due to banks and deposits from the National Bank of
Hungary and other banks		2,098,175	1,761,579	1,695,534
Repo liabilities		510,970	443,694	1,213,909
Deposits from customers	9.	11,222,553	10,734,325	10,819,069
Leasing liabilities		69,537	68,282	41,393
Liabilities from issued securities	10.	1,374,135	1,163,109	546,668
Financial liabilities designated at fair value through profit or loss		18,760	19,786	19,068
Derivative financial liabilities designated as held for trading		161,412	183,565	355,423
Derivative financial liabilities designated as hedge accounting
relationships		49,112	27,423	34,966
Deferred tax liabilities		536	-	-
Current tax liabilities		17,251	14,393	1,738
Provisions		21,032	22,497	34,922
Other liabilities		375,044	295,399	582,215
Subordinated bonds and loans		546,417	520,296	511,615
TOTAL LIABILITIES		16,464,934	15,254,348	15,856,520
Share capital		28,000	28,000	28,000
Retained earnings and reserves		2,601,548	2,276,759	1,787,910
Treasury shares		(21,197)	(6,154)	(10,094)
TOTAL SHAREHOLDERS' EQUITY		2,608,351	2,298,605	1,805,816
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		19,073,285	17,552,953	17,662,336

OTP Bank Plc Separate Condensed Financial Statements 2024Q1

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OTP BANK PLC.

SEPARATE CONDENSED STATEMENT OF PROFIT OR LOSS FOR THE THREE MONTH

PERIOD ENDED 31 MARCH 2024 (UNAUDITED)

(in HUF mn)

	Note	Three month	Three month	Year ended 31
		period ended 31	period ended 31	December
		March 2024	March 2023	2023
Interest income and similar to interest income total	13.	436,039	492,801	2,023,079
Interest expenses total	13.	(311,869)	(387,696)	(1,556,361)
NET INTEREST INCOME	13.	124,170	105,105	466,718
Risk cost total		9,371	(6,549)	26,687
NET INTEREST INCOME AFTER RISK COST		133,541	98,556	493,405
Gains / (Losses) arising from derecognition of		(873)	(8,531)	(19,707)
financial assets measured at amortised cost
Modification loss		(21)	-	(9,017)
Net profit from fees and commissions		80,070	75,260	324,130
Net operating income		245,962	148,340	464,606
Other administrative expenses		(128,858)	(183,578)	(528,136)
PROFIT BEFORE INCOME TAX		329,821	130,047	725,281
Income tax		(13,549)	(5,249)	(70,293)
PROFIT AFTER INCOME TAX		316,272	124,798	654,988
Earnings per share (in HUF)
Basic		1,133	232	2,344
Diluted		1,133	232	2,344

OTP Bank Plc Separate Condensed Financial Statements 2024Q1

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OTP BANK PLC.

SEPARATE CONDENSED STATEMENT OF COMPREHENSIVE INCOME FOR THE THREE

MONTH PERIOD ENDED 31 MARCH 2024 (UNAUDITED)

(in HUF mn)

	Three month	Three month	Year ended 31
	period ended 31	period ended 31	December
	March 2024	March 2023	2023
PROFIT AFTER INCOME TAX	316,272	124,798	654,988
Items that may be reclassified subsequently to profit or loss:
Fair value adjustment of debt instruments at fair value through other
comprehensive income	9,110	3,196	(55,804)
Deferred tax related to fair value adjustment of debt instruments at
fair value through other comprehensive income	(804)	(278)	5,186
Gains / (Losses) on separated currency spread of financial
instruments designated as hedging instrument	(2,602)	2,186	(4,887)
Deferred tax related to (losses) / gains on separated currency spread
of financial instruments designated as hedging instrument	234	(197)	440
(Losses) / Gains on derivative financial instruments designated as
cash flow hedge	(496)	1,735	(5,641)
Deferred tax related to gains on derivative financial instruments
designated as cash flow hedge	-	-	-
Items that will not be reclassified to profit or loss:
Gains on equity instruments at fair value through other
comprehensive income	-	-	2,675
Fair value adjustment of equity instruments at fair value through
other comprehensive income	2,547	204	61
Deferred tax related to equity instruments at fair value through other
comprehensive income	(288)	(23)	(41)
Total	7,701	6,823	(58,011)
TOTAL COMPREHENSIVE INCOME	323,973	131,621	596,977

OTP Bank Plc Separate Condensed Financial Statements 2024Q1

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OTP BANK PLC.

SEPARATE STATEMENT OF CHANGES IN EQUITY FOR THE THREE MONTH PERIOD ENDED

31 MARCH 2024 (UNAUDITED)

(in HUF mn)

	Share	Capital	Retained earnings	Treasury	Total
	Capital	reserve	and other reserves	Shares
Balance as at 1 January 2023	28,000	52	1,655,549	(2,724)	1,680,877
Net profit for the period	-	-	124,798	-	124,798
Other comprehensive income	-	-	6,823	-	6,823
Total comprehensive income	-	-	131,621	-	131,621
Share-based payment	-	-	697	-	697
Sale of treasury shares	-	-	-	612	612
Acquisition of treasury shares	-	-	-	(7,982)	(7,982)
Loss on sale of treasury shares	-	-	(9)	-	(9)
Other transaction with owners	-	-	688	(7,370)	(6,682)
Balance as at 31 March 2023	28,000	52	1,787,858	(10,094)	1,805,816
Balance as at 1 January 2024	28,000	52	2,276,707	(6,154)	2,298,605
Net profit for the period	-	-	316,272	-	316,272
Other comprehensive income	-	-	7,701	-	7,701
Total comprehensive income	-	-	323,973	-	323,973
Share-based payment	-	-	807	-	807
Sale of treasury shares	-	-	-	559	559
Acquisition of treasury shares	-	-	-	(15,602)	(15,602)
Loss on sale of treasury shares	-	-	9	-	9
Other transaction with owners	-	-	816	(15,043)	(14,227)
Balance as at 31 March 2024	28,000	52	2,601,496	(21,197)	2,608,351

OTP Bank Plc Separate Condensed Financial Statements 2024Q1

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OTP BANK PLC.

SEPARATE CONDENSED STATEMENT OF CASH FLOWS FOR THE THREE MONTH PERIOD

ENDED 31 MARCH 2024 (UNAUDITED)

(in HUF mn)

	Three month	Three month
	period ended 31	period ended 31	Year ended 31
	March 2024	March 2023	December 2023
Profit before income tax	329,821	130,047	725,281
Net accrued interest	48,604	(295)	3,136
Income tax paid	(19,213)	(7,345)	(19,213)
Depreciation and amortization	13,459	12,235	50,834
Loss allowance / (Release of loss allowance)	(8,875)	7,041	(102,219)
Share-based payment	807	697	3,292
Unrealised gains on fair value adjustment of financial instruments at
fair value through profit or loss	(5,479)	(16,137)	(95,953)
Unrealised losses on fair value adjustment of derivative financial
instruments	2,953	(8,308)	(76,357)
Gains on securities	858	7,742	18,890
Interest expense from leasing liabilities	(679)	418	(2,081)
Foreign exchange loss	29,752	(8,331)	(20,842)
Proceeds from sale of tangible and intangible assets	(101)	(1,191)	(1,225)
Net change in assets and liabilities in operating activities	549,980	1,031,611	(634,062)
Net cash provided by operating activities	941,887	1,148,184	(150,519)
Net cash used in investing activities	(1,318,098)	(116,573)	518,615
Net cash provided by financing activities	116,217	299,427	845,059
Net (decrease) / increase in cash and cash equivalents	(259,994)	1,331,038	1,213,155
Cash and cash equivalents at the beginning of the year	1,564,925	351,770	351,770
Cash and cash equivalents at the end of the year	1,304,931	1,682,808	1,564,925

OTP Bank Plc Separate Condensed Financial Statements 2024Q1

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NOTE 1:ORGANIZATION AND BASIS OF FINANCIAL STATEMENTS

1.1. General information

These interim condensed financial statements had been prepared in accordance with the prescriptions of IAS 34.

1.2. Accounting

The Bank maintains its accounting records and prepares its statutory accounts in accordance with the commercial, banking and fiscal regulations prevailing in Hungary.

The presentation and the functional currency of the Bank is the Hungarian Forint ("HUF").

The Bank followed the same accounting policies and methods of computation in the interim financial statements as compared with the most recent annual financial statements.

NOTE 2:SIGNIFICANT EVENTS DURING THE THREE MONTH PERIOD ENDED 31 MARCH 2024

1. Capital increase at Monicomp Ltd. See details about the event in Note 8.
2. Capital increase at JSCMB 'IPOTEKA BANK' See details about the event in Note 8.
3. Capital increase at OTP Real Estate Ltd.

See details about the event in Note 8.

1. OTP Bank is selling its Romanian operations See details about the event in Note 8.
2. 600 millió EUR kötvénykibocsátás

See details about the event in Note 10.

NOTE 3:SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD

In the section below, the measures and developments which have been made since the balance sheet date, and - in OTP Bank's view - are relevant and have materially influenced / can materially influence the operation of the Bank.

OTP Bank excludes any liability for the completeness and accuracy of the measures presented herein. Post-balance sheet events cover the period until 3 May 2024.

• The cap on deposit rates, and the rate cap on small and medium enterprises' existing variable-rate loans, introduced pursuant to government decrees No. 471/2022. (XI. 21.) and No. 415/2022. (X. 26), expired on 1 April 2024.
• On 23 April 2024 the National Bank of Hungary cut its key policy rate by 50 bps to 7.75%.
• On 26 April 2024 S&P Global Ratings affirmed its 'BBB-/A-3' long- and short-term foreign and local currency sovereign credit ratings on Hungary. The outlook is stable.

OTP Bank Plc Separate Condensed Financial Statements 2024Q1

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NOTE 4:FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS (in HUF mn)

Held for trading securities:	31 March 2024	31 December 2023
Government bonds	39,674	22,352
Other non-interest bearing securities	328	320
Hungarian government discounted Treasury Bills	2,196	71
Corporate shares and investments	905	513
Mortgage bonds	106	111
Hungarian government interest bearing Treasury Bills	-	-
Other securities	6,251	4,437
Subtotal	49,460	27,804
Securities mandatorily measured at fair value through profit or loss
Shares in investment funds	31,786	31,124
Bonds	272	-
Shares	1,808	1,808
Subtotal	33,866	32,932
Held for trading derivative financial instruments:
Foreign currency swaps	51,426	66,324
Interest rate swaps	61,684	65,434
CCIRS and mark-to-market CCIRS swaps	25,235	23,221
Other derivative transactions	47,761	41,820
Subtotal	186,106	196,799
Total	269,432	257,535

NOTE 5:SECURITIES AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME (in HUF mn)

	31 March 2024	31 December 2023
Securities at fair value through other comprehensive income
Government bonds	202,302	189,385
Mortgage bonds	304,444	300,569
Interest bearing treasury bills	352	236
Corporate shares and investments	-	-
Other securities	49,696	48,160
Listed securities	12,212	11,622
in HUF	-	-
in foreign currency	12,212	11,622
Non-listed securities	37,484	36,538
in HUF	11,549	12,115
in foreign currency	25,935	24,423
Subtotal	556,794	538,350
Non-trading equity instruments
-non-listed securities	23,726	21,177
in HUF	528	528
in foreign currency	23,198	20,649
	23,726	21,177
Securities at fair value through other comprehensive income total	580,520	559,527

OTP Bank Plc Separate Condensed Financial Statements 2024Q1

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NOTE 6:SECURITIES AT AMORTISED COST (in HUF mn)

	31 March 2024	31 December 2023
Government bonds	2,408,061	2,396,803
Other bonds	1,721,583	315,532
Mortgage bonds	24,988	24,738
Subtotal	4,154,632	2,737,073
Loss allowance	(26,549)	(26,225)
Total	4,128,083	2,710,848

An analysis of change in the loss allowance on securities at amortised cost:

		31 March 2024	31 December 2023
Balance as at 1 January	26,225	35,850
Loss allowance		2,356	2,287
Release of loss allowance	(2,701)	(10,863)
FX movement		669	(1,049)
Closing balance	26,549	26,225
NOTE 7:	LOANS (in HUF mn)
Loans mandatorily measured at fair value through profit or loss
		31 March 2024	31 December 2023
Within one year		45,794	46,131
Over one year		900,329	888,717
Loans measured at fair value through profit or loss total	946,123	934,848
Loans measured at amortised cost, net of allowance for loan losses
		31 March 2024	31 December 2023
Within one year		2,352,924	2,245,979
Over one year		2,554,434	2,582,795
Loans at amortised cost gross total	4,907,358	4,828,774
Loss allowance on loan losses	(136,794)	(147,415)
Loans at amortised cost total	4,770,564	4,681,359
An analysis of the loan portfolio by currency (%):
		31 March 2024	31 December 2023
In HUF		60%	61%
In foreign currency	40%	39%
Total		100%	100%

OTP Bank Plc Separate Condensed Financial Statements 2024Q1

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