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Lender ProCredit Bank Romania sees EUR 3m losses in Q1, expects to remain in the red at year-end

ProCredit Bank Romania, part of the ProCredit group, reported a 3 million euro loss in the first quarter on higher provisions and estimates to remain in the red this year, although it expects a profit in the fourth trimester, according to the lender's general manager, Asmus Rotne.

The bank estimates 5-6 million euro losses at the end of the year. It had a 470,250 euro profit after the first three months of 2008.

ProCredit Bank managed assets of 283 million euros at the end of March, down 3.4 percent over the 293 million euros at the end of 2008, owing to differences of the exchange rate.

The bank granted loans worth 205 million euros in the first quarter, versus 217 million euros at the end of last year, while deposits amounted to 160 million euros, close to the value recorded in December last year.

The GM of ProCredit Bank expects lower interests in the next period, but for savings first.

Provisions rose significantly in the past period, to almost 2 million euros on the profit and losses account and up to 9.5 million euros on the balance sheet. Their further evolution will depend on the way Romania's economy will revive, Rotne said.

The GM also mentioned he expects a comeback of the construction sector, but not at the same rate as in the previous years. ProCredit Bank is currently focusing on the agricultural sector and on the businesses in charge with current needs, which are considered to have growth potential.

Romania's economy deteriorated very quickly exactly in the sectors that represented the economy's engine: real estate transactions, consumer loans and exports, Rotne deems.

ProCredit has a 2 percent exposure on the real estate segment and a 20 percent one in the agriculture sector.

The average amount contracted through a loan from ProCredit Bank stands at 5,000 euros, maturing in up to 15 years. Most companies use the money to buy equipments or raw materials.

The lender froze employees' salaries, will not spread tentacles in 2009

ProCredit Bank cut ribbon for three units this year and reached a 43-unit network, according to Rotne, but the lender will most likely stop the expansion plans in 2009, he added.

The lender also froze employees' salaries and is currently renegotiating rental contracts in a bid to cut expenses, the GM also mentioned.

ProCredit Bank Romania doubled loans under forced execution to EUR 1.5m

ProCredit Bank Romania hiked two-fold the volume of credits under forced execution to 1.5 million euros, while nonperforming credits reached 3.2 percent of the bank's loan portfolio, from 1.57 percent at the end of 2008, said Rotne.

From the total volume of loans granted, some 14 percent were given to medium and large companies and 86 percent for small and very small businesses. Credits in foreign currencies weigh 25 percent in the lender's portfolio.

ProCredit Bank Romania was set up in 2002, as a partnership between the European Bank for Reconstruction and Development (EBRD), the International Financial Corporation (member of the World Bank), Commerzbank, KfW, ProCredit Holding and IPC.

The bank has a share capital of 20 million euros and currently counts 105,000 clients.

 

Sursa: http://www.newsin.ro

Tags: procredit rotne euros percent million expects romania losses lender euro

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