Erste Has Worst Three-Day Drop in Month on Hungary: Prague Mover

Austria’s Erste Group Bank AG (RBAG) fell in its biggest three-day retreat in more than a month after Hungarian Prime Minister Viktor Orban said he seeks to reduce foreign banks’ presence in the country.

Erste, which operates across emerging Europe, including in Hungary, led stock declines in Prague after Danske Bank A/S analysts said Orban’s plan revealed yesterday is “in effect threating to nationalize” part of the industry. Italy’s Intesa Sanpaolo SpA (ISP) may curb activities in Hungary, Chief Executive Officer Enrico Tommaso Cuchicani said yesterday after Orban’s comments, calling the country a “nightmare.”

“We regard the situation in Hungary and in particular the prime minister’s statement as continuing negative sentiment” toward lenders, including the Hungarian unit of Erste, Milan Lavicka, an analyst at J&T Banka AS in Prague, said in a report.

The stock fell 2.2 percent to 23.81 euros by close in Vienna, extending its loss this week to 6.9 percent. In Prague trading, Erste shares slid 2.3 percent to 612.7 koruna.

Lavicka has a hold rating for Erste with a price estimate of 20.4 euros, according to the J&T report.

To contact the reporter on this story: Krystof Chamonikolas in Prague at kchamonikola@bloomberg.net

To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net

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