The group around Slovenia's largest bank, NLB, posted a net profit of EUR 377.8 million in the first nine months of the year, which is 84% more year-on-year. Contributing the most to the increase is the takeover of N Banka, formerly the Slovenian subsidiary of the Russian Sberbank, NLB said on Thursday.

"NLB Group business results in the first nine months are excellent and do not yet show the level of stress that the market expects," NLB CEO Blaž Brodnjak commented in the release.

He said the bank planned to pay out a total of EUR 500 million in dividends until 2025.

Net revenue in the first nine months were up 13% compared to the same period last year.

The group's total capital ratio of 16.6% is well above the regulatory requirement, the bank said, adding that it was prepared for "any potential incremental worsening of the business environment".

N Banka, formerly the Slovenian subsidiary of the Russian Sberbank, which NLB acquired on 1 March and renamed on 11 April, contributed EUR 182.1 million to the group's total net profit. But even without this contribution, profit before impairments and provisions would be up by 28%.

The group generated EUR 353.1 million in net interest revenue, up 17% year-on-year, with N Banka contributing EUR 6.7 million. Net non-interest revenue was up by 7% to EUR 210.6 million, with N Banka accounting for EUR 4.7 million.

Net profit was up by 13% to EUR 563.7 million. Despite inflation, the group managed to cut costs, Brodnjak said. The group's pre-tax profit increased by 78% to EUR 407.4 million, while profit before impairments and provisions rose by 14% to EUR 231.1 million.

In the January-September period, the NLB group released EUR 7.5 million in net impairments and provisions for credit risks through the successful recovery of N Banka-related claims that had already been written off (EUR 28.1 million).

The group reports of EUR 5.1 million in other impairments and provisions, including EUR 4.6 million for an overhaul of the Belgrade-based NLB Komercijalna Banka, which has been operating under this name since 30 April after the merger of Komercijalna Banka and NLB.

Compared to the end of 2021, deposits increased by EUR 1.08 billion, with almost half of the increase being contributed by N Banka.

The group's gross loans were up by EUR 2.3 billion in the period, of which the takeover of N Banka contributed slightly more than EUR 1.1 billion.

The core bank NLB posted a net profit of EUR 94.2 million in the first nine months of the year, down 11.1% year-on-year.

Brodnjak expects the group's revenue to stand at EUR 750 million at the end of the year, rising to EUR 850 million at the end of next year. "The bank has never been in better shape," he said.

In the period between 2022 and 2025, the bank plans to pay out EUR 500 million in dividends. Shareholders have already received EUR 50 million in June and they are to receive the same amount after the AGM planned for 12 December. Next year, EUR 110 million are to be paid out as dividends.