The four-for-one Erste Bank stock split will come into effect on the Vienna and Prague Stock Exchanges tomorrow. The stock split will be processed automatically for all investors whose shares are held in custody. After the completion of the split, the bank will have 241,442,892 shares, each representing EUR 2.00 of the capital stock of the bank.
Ceska sporitelna, Erste's 98%-owned subsidiary, is increasing its interest rates on both the asset and liability sides of the balance sheet in response to the recent repo-rate increase of 25 base points. The hike has been reflected more in products with medium-term and long-term maturity, for example a 5-year guaranteed interest rate on mortgages will rise by 50bps to 5.99% p.a. Interest rates on customer deposits in CZK are rising by up to 80bps. The increase in interest rates had been expected (e.g. Komercni banka raised its key rates by 30 bps earlier last week), should ease pressure on interest margins, and is largely reflected in projections and valuations.
Jan Hájek