K&H Bank’s net profit reached HUF 8 billion, with HUF 48 billion paid in bank taxes in the first quarter of 2025; K&H Insurance recorded a net profit of HUF 0.8 billion

Commenting on the results, K&H Group CEO Peter Roebben said: “Despite the fact that the economic conditions were challenging and the first quarter was characterised by modest growth and higher than expected inflation in the Hungarian economy, K&H continued to deliver an excellent business performance in the first quarter of 2025.  Demand for mortgage and consumer loans was very dynamic, and both our loan and deposit portfolios grew at above-market rates. At the same time, in the business sector investment appetite is currently limited and demand for corporate loan is subdued.  K&H Bank’s profit after tax decreased compared to the same period of last year due to higher bank taxes, flattish interest income and intensive IT investments. K&H is also participating in the voluntary fee cap as proposed by the Ministry for National Economy and the account management and card fees will be kept at the rate levels of the end of 2024 until 30 June 2026.  K&H continues to welcome new customers every day and we currently serve more than 1 million banking customers, representing an annual growth of 4 percent. We are also at the forefront of digital innovation in the Hungarian market; this is reflected by the fact that 80 percent of our customers are digitally active and two third of these have already tried the services of Kate, our artificial intelligence-based digital financial assistant. In 2025, we received the “Best Digital Bank in Hungary” award from Global Banking and Finance Review for the third time. K&H’s digital developments are all aimed at making it as convenient, fast and easy as possible for our customers to manage their finances”.

Excellent business results in the first quarter of 2025

K&H Bank reported a profit after tax of HUF 8 billion and the first quarter is impacted by HUF 48 billion bank tax. The bank’s income increased by 1 percent. Net interest income stagnated, while total loans increased by 8 percent year on year to HUF 3,111 billion, and deposits grew by 8 percent to HUF 4,092 billion. In the first quarter, K&H disbursed nearly HUF 160 billion in new loans to corporate and retail customers. Assets under management in investment funds increased by 21 percent to more than HUF 1,800 billion by the end of Q1 2025. Inflation-induced cost pressure, spending on new digital solutions, and the bank tax pushed up operating costs by 14 percent. The portfolio of government securities grew by 62 percent year on year to HUF 1,633 billion by the end of the first quarter of 2025.

“Demand for corporate loans in the banking sector remained subdued however K&H could further strengthen its market position, with 5-percent year-on-year volume growth. K&H continues to actively participate in government-subsidized financing schemes that support the day-to-day operations and development expenditures of businesses: our total contracted volume under the Széchenyi Card Program exceeded HUF 300 billion. K&H’s project finance portfolio reached HUF 414 billion in the non-financial corporate customer segment, representing a market share of over 11 percent. Our leasing portfolio exceeded HUF 108 billion by the end of March this year, and the volume of new leases exceeded HUF 10 billion,” K&H Group CFO Attila Gombás said.

“The housing market continues to grow this year strongly: while the banking sector as a whole saw an 11-percent increase in retail loans, K&H recorded 13 percent growth in a year. The volume of new housing loans amounted to HUF 42 billion. At the same time, the average amount of housing loans jumped from HUF 18 million to over HUF 25 million, an increase of more than 40 percent in a year. The increase is mainly explained by the fact that housing has become that much more expensive compared to a year ago. Baby loans brought in a similar volume of new contracts as a year earlier, while the overall market contracted, bringing the bank’s market share to 16.2 percent. The volume of personal loan disbursements increased by 44 percent year on year, reaching HUF 20 billion in the first quarter. Our customers have quickly taken to the state-subsidized, low-interest loans for workers. In total, our portfolio of such loans already exceeded HUF 8 billion in March, while our market share for this product exceeded 13 percent in March. On the savings side, the volume of customer deposits reached HUF 4,092 billion, up 8 percent year on year. In retail deposits, we achieved 13 percent growth, which exceeded the banking sector,” Attila Gombás added.

Nik Vincke, CEO of K&H Insurance, said: “In 2025 Q1 net profit reached HUF 0.8 billion (including HUF 3.8 billion windfall tax). In the corresponding period of 2024, the entire year’s windfall tax resulted HUF -3.1 billion net loss. In non-life, our non-MTPL policy portfolio increased by 11 percent year-on-year. Life also brought strong business performance in targeted product lines, the policy portfolio increased by 16 percent year-on year in regular unit-linked pension savings and 5 percent in regular risk business lines.”

Digitalization and innovation

K&H has almost 800 000 digitally active customers who carry out 2.5 million transactions per month and mostly use the mobile application for money transfers. Two third of customers banking digitally have already tried Kate, the artificial intelligence-based digital financial assistant. Kate’s latest development is that she can now tell you your bankcard number, expiration date and CVC code. Kate handles 150 000 interactions and shows card details 60 000 times per month. She also helps with a total of 320 functions, taking out insurance, managing loans, starting savings and investments as well as activates and digitizes bankcards and handles almost two thirds of all transactions autonomously.

“For K&H, it is of paramount importance that our customers should be able to use our banking services quickly and conveniently, anywhere and at any time. We are also constantly looking for opportunities beyond finance, where we can be a natural partner to help them meet their daily needs. We are simplifying, digitizing and automating our processes as much as possible to achieve this,” said Balázs Németh, Chief Innovation Officer at K&H. “ATMs that allow customers to deposit cash have proven to be one of the most successful innovations at K&H in recent years. With over 560 ATMs available nationwide, customers can pay cash into their accounts quickly and easily. Seeing the positive response from customers, K&H has significantly increased its ATM network by almost 20 percent over the past year and a half. In addition, cash withdrawals have become more convenient than ever, as you no longer even need a physical bankcard – a digital card stored on a smart device or mobile phone is sufficient. Data shows that these devices are playing an increasingly important role in banking. Nearly 60 percent of new retail accounts are opened online, the number of digital SZÉP card merchant locations has reached 22,000, and we now have 75,000 customers with digital SZÉP cards. In terms of digitization insurance service is permanently improving as well: customers can opt for electronic communication for their life insurances in the mobile bank and conclude travel insurance with the assistance of Kate. Possibility of conclusion of MTPL&Casco as a combined offer is also available from February 2025 in the mobile bank. “

Sustainability

Through responsible financing, banks play a key role in encouraging companies and consumers to make a green transition. According to the Hungarian National Bank’s classification system, K&H’s corporate green loan portfolio has reached HUF 152 billion, which represents a market share of 23 percent. K&H Bank was the first bank in Hungary to launch a green housing loan product back in August 2022, and we currently offer green housing loans at the best public interest rate and it had HUF 49.3 billion of green housing loans at the end of March 2025.

“A key priority for us is to actively engage with our customers and partners to address the global challenges of climate change. To this end, we develop and offer financial products and services that directly support the transition to a low-carbon economic model for a sustainable common future.  In savings, 55 percent of customer assets are concentrated in responsible investment funds, which is unparalleled in the market and reflects our commitment to green transition. Already 65 percent of this year’s gross sales have been channelled into responsible investment funds, which support social and/or environmental sustainability. Furthermore, in casco insurance there was 23 percent share of electric cars in new casco policies and the share of electric cars in new K&H green car leasing contracts reached 13 percent in the first quarter of 2025”, K&H Group CEO Peter Roebben said.                                           

A summary of K&H Group’s 2024 sustainability activities is provided here.

K&H’s unaudited, consolidated results in accordance with IFRS (International Financial Reporting Standards):

K&H’s unaudited, consolidated results according to the international financial reporting standards (IFRS):