Banks and insurance companies in Serbia post record-high profit

According to the ranking published in the latest annual edition of Finance TOP, Raiffeisen Bank was the most profitable bank in Serbia in 2023, with a profit of 21.4 billion dinars. Dunav Insurance is first on the list of insurers, with premiums exceeding 40 billion dinars last year. Representatives of the financial sector predict that inflation in Serbia is likely to be curbed soon, but it is unrealistic to expect a reduction in any consumer prices, including the prices of financial products.

Raiffeisen Bank was the most profitable bank in Serbia in 2023, with a profit of 21.4 billion dinars. However, this result is partly due to one-off effects following Raiffeisen Bank’s acquisition of Credit Agricole Bank. Banca Intesa is in second place with a profit of 21 billion dinars, followed by UniCredit Bank in third place with earnings of 18.5 billion dinars. OTP Bank recorded a profit of 16.7 billion dinars and took the fourth position, while the fifth is NLB Komercijalna Banka with 15.1 billion dinars.

In the rankings of the Business and Finance monthly, the largest bank by assets with a market share of 15.6% is still Banca Intesa, followed by OTP Bank (13.9%), AIK Bank (13.1%), Raiffeisen Bank (11.2%), and UniCredit Bank (10.7%).

A Golden Age for Bankers

According to data in the June annual edition of the monthly Business and Finance, the net profit of banks in 2023 reached 122.2 billion dinars, after most market players achieved a record final result in their history, and the average return on capital for the banking sector was around 15%. The main reason for last year’s earnings increase was the net interest income, which rose by 52% to 227.6 billion dinars.

Western Banks More Profitable Here Than at Home

Western European banks operating in Central and Eastern Europe (CEE), including Serbia, achieve a higher return on capital compared to the Western European market, thereby increasing the profitability of their parent banks.

Despite slower credit activity, the profitability of Western European banks’ subsidiaries in CEE reached a record level in 2023. The countries with the greatest potential for further growth in the banking sector are Romania, Serbia, Bosnia and Herzegovina, and Albania.

Voluntary Health Insurance Led in Premium Growth, but Also in Claims

Last year, Dunav Insurance topped the market with a premium slightly exceeding 40 billion dinars, holding a market share of 26%. Generali Insurance Serbia came in second with a premium of nearly 29 billion dinars and an 18.7% market share, while Wiener Städtische Insurance was in third place with a premium of 17.4 billion dinars and an 11.3% market share. Following them is DDOR Novi Sad, which collected 16.9 billion dinars in premiums and holds a market share of 10.9%. In fifth place is Triglav Insurance, with a premium of 11.3 billion dinars and a 7.3% market share, according to the ranking by the economic monthly Business and Finance.

Insurance companies in Serbia achieved a total premium of 155.25 billion dinars in 2023, 22 billion more than in 2022. This result was primarily influenced by the increase in the price of mandatory auto liability insurance, with the premium rising from 38.9 billion dinars to 46.2 billion dinars in one year. Voluntary health insurance followed, with a premium of 14.58 billion dinars, an increase of 4.68 billion dinars compared to 2022. Voluntary health insurance is also the fastest-growing insurance, with a growth rate of 47%.

(Biznis i Finansije, 27.06.2024)

This post is also available in: Italiano

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