BUSINESS

EUR 83 M profit for Raiffeisen Bank Romania in 2010

During a difficult economic environment, in most part, bank’s good results can be attributed to the 50 pc drop in expenditures on provisions, as Steven van Groningen, President and CEO Raiffeisen Bank Romania, stated.

In 2010 Raiffeisen Bank reported a net profit of EUR 83 M, up by 12 per cent compared to the EUR 74 M profit reported the year before, thus continuing to rank among the top three players on the Romanian banking market.


“Obtained in the context of a difficult economic environment, the bank’s 2010 results are really exceptional and we consider them solid. In most part they can be attributed to the 50 per cent drop in expenditures on provisions, from EUR 88 M in 2009 to EUR 48 M in 2010,” Steven van Groningen, President and CEO Raiffeisen Bank Romania, stated yesterday during a press conference.


At the end of 2010 the total value of Raiffeisen Bank Romania assets stood at EUR 5.11 bln, up by 9 per cent compared to the same period the year before. In a year the total volume of credits grew by 18 per cent to EUR 3.04 bln, while the volume of deposits grew by 9 per cent to EUR 3.69 bln. Consequently, the credits/deposits ratio stood at 83 per cent at the end of 2010, in contrast to 76 per cent at the end of the previous year. The bank’s solvency rate (including profit) stood at 13.3 per cent at the end of 2010, revealing healthy liquidity and solid capitalization.


Bank representatives announced they will propose to shareholders the launching of a programme of RON and forex-denominated medium-term notes that would be used to draw funds of up to EUR 1.5 bln with a maturity of over one year, on the basis of the legislation in Germany and Luxembourg.


Raiffeisen Bank Romania’s operational expenditures of EUR 266 M were slightly lower than the year before (EUR 269 M). The net revenue dropped by 8 per cent to EUR 413 M, a development foreseen by the bank given the fact that the economy has went through a significant recession and that the consumers’ confidence in the economy has remained at one of the lowest levels in the EU. These factors also influenced the bank’s cost/benefit ratio that went from 60 per cent in 2009 to 64.5 per cent in 2010.
Raiffeisen Bank Romania’s customer base continued to remain at approximately 2 million in 2010. Of those, 105,000 were SMEs and 8,000 were corporate clients. At the end of 2010 the Raiffeisen Bank network included 540 units compared to 559 at the end of 2009. At the end of 2010 the bank had 6,104 employees, the figure slightly dropping from 6,138 at the end of 2009.


All the figures presented are audited and observe the International Financial Reporting Standards (IFRS). The figures concern exclusively the results announced by Raiffeisen Bank S.A. and may differ from those that Raiffeisen Bank International AG (RBI) will announce on April 8, 2001, when it will publish its annual report.


REDUCTION OF STATE GUARANTEES FOR FIRST FOME, ADDITIONAL COSTS FOR BANKS


As regards the reduction by half of state guarantees for the First Home programme, the CEO of Raiffeisen Bank Romania stated that this decision would not affect the banks’ loan portfolio, but would presuppose additional costs for the credit institutions. In the latter’s opinion, these costs have to borne by someone, but the Government insists on maintaining costs unchanged.


“If the Government wishes to keep costs at a steady level, I think some banks will no longer be interested in the program and would rather propose their own products,” van Groningen further stated. He explained that there are mortgage loans on the market, offering similar terms as far as interests are concerned, but the main advantage afforded by the First Home program is a merely 5 pc down payment. Steven van Groningen stated that Raiffeisen Bank Romania had not reached a decision yet on the Government’s proposal regarding the reduction of state guarantees from 100 pc to 50 pc in the First Home program.

Related posts

Hidroelectrica sells three micro-hydropower plants for EUR 2.5 M

Nine O' Clock

Cristian Sporis returns to Raiffeisen Bank

Nine O' Clock

Bucharest jumps to 27th place in a top of best European towns for doing business

Nine O' Clock

Leave a Comment