Small businesses are recovering faster than big corporations, says head of OTP

Small and medium-sized enterprises, which last year were hit the hardest amid a collapse of their business, are now beginning to recover, with their financial situations sometimes looking better than those of big companies, says Laszlo Diosi, the head of OTP Bank, the local subsidiary of the biggest Hungarian financial group.

"We will focus on funding SMEs this year," said Diosi during a meeting with journalists. OTP, a medium-sized bank with around one billion euros in assets, includes in the SME segment companies with up to 2 million euros in yearly turnover.

A year ago Diosi said small firms were the most affected by the crisis, because they did not have reserves or the ability to make significant savings by cutting costs. Now, he notes a surprising rebound of small businesses, while big companies are still struggling.

In fact, OTP posted losses in the second half of last year after it had to set up provisions for a number of high-value loans granted to real estate developers.