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Raiffeisen Bank Romania profit reached record level of EUR 165 M in 2008

Raiffeisen Bank Romania posted for the past year a net profit of EUR 165 M, up 75.6 per cent over 2007, when if obtained a net profit of EUR 94 M, on the background of a major growth of the revenues from interest rates and commissions, the bank announced yesterday in a press conference. Last year, the profit prior to taxation was almost EUR 196 M, rising from EUR 116 M in 2007.

"Despite the current difficult period generated by the international financial crisis, Raiffeisen Bank succeeded in obtaining record results for 2008. These results are a consequence of our solid customer base, of the fact that we became more efficient in what we do and thus were able to increase the bank's profitability. Along with that, we focused on increasing the quality of our services and on developing long-term partnerships with our customers," said Steven van Groningen (photo), president and CEO of Raiffeisen Bank.

Raiffeisen Bank Romania will make a profit also in 2009, assured van Groningen, but below the level of the past year, on the background of the growth of provisions and the shrinking of the banking activity.

The bad credits exceeded 3 pc of the portfolio in 2008

The credits granted by Raiffeisen exceeded EUR 2.67 bln last year, up 14 per cent over the same period of 2007. At the same time, the deposits of the clients totalled over EUR 3.65 bln.

On December 31, 2008, Raiffeisen Bank granted credits of EUR 1.155 bln to over 100,000 Romanian companies, over EUR 1.281 bln to natural persons, and EUR 242 M to the entities which belong to the public sector from Romania, according to the declaration of the general manager of Raiffeisen International Herbert Stepic.

In his turn, the president of the Austrian Bank in Romania added that last year the bad credits of Raiffeisen Bank exceeded 3 per cent of the loan portfolio of the bank, after a more marked growth in the last quarter of the year, and will continue to grow. Raiffeisen Bank Romania also externalized loans of EUR 2 bln in 2008.

Raiffeisen will not withdraw money from Romania

Herbert Stepic, executive manager Raiffeisen International, who controls Raiffeisen Bank Romania, stressed that except for the dividends due to shareholders, Raiffeisen group has not withdraw and will not withdraw money at all from Romania. He stressed that in the conditions in which the level of the granted credits exceeds significantly the value of the attracted deposits, Raiffeisen International supports the crediting activity of its branch from Romania through funding lines.

The net income from interest rates of the bank advanced 23 per cent, to EUR 245 M, while the income from commissions rose 27 per cent in 2008, to EUR 246 M. The personnel and administrative expenditures increased last year by 12 per cent against 2007. Raiffeisen Bank will reduce the hiring this year, while the departures of the employees will reduce the personnel of the bank until the end of 2009, in the conditions in which at the end of 2008 the bank had 6,800 employees, the president of Raiffeisen Bank Romania, Steven van Groningen, added. Raiffeisen Bank continued to develop the territorial network in 2008, the number of units rising to 553 at the end of December.

Exposure below 10 pc in real estate sector

The exposure of Raiffeisen Bank Romania in the real estate sector will remain probably at the present level, of almost 10 per cent of the portfolio of the bank, declared Steven van Groningen. "We have set a maximum exposure of 15 per cent in the real estate sector, and presently we are comfortably lower, below 10 per cent. Thus, we could rise, but I don't think that the timing is good, and we shall remain most probably at the same percentage," van Groningen said. Thus, Raiffeisen Bank "cannot be affected by a crisis in the real estate sector," he mentioned.

 

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Tags: raiffeisen romania credits sector level profit groningen

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