Dramatic year for indie investment banking firms

Diana Cioltei, 27 Aug 2009

Romanian version

With the local M&A market in lockdown mode and acute deepening of financial crisis, the numbers for 2008 are dramatic to independent investment banking firms. Independent investment firms have reported losses and sharp profit fall for last year, as shown in the statements posted on the website of the Ministry of Finance.

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Capital Partners: 87% profit fall

Romania’s largest investment banking firm, Capital Partners, recorded a sharp decline in 2008 profit, by 87%, from 1.5 million euros in 2007, to 224,000 euros a year earlier.

The turnover followed the same downward trend, falling 65% below year-ago levels, from 4.4 million euros to 1.79 million euros in 2008.

Doru Lionachescu (photo), managing partner of Capital Partners says margins were weighed down by the 10month-long negotiations with Piraeus, coupled with the deep recession that set in after the collapse of Lehman Brothers in September.

“2008 numbers reflect the shaky market conditions we dealt with – talks with Piraeus lasted almost 10 months. Additionally, in spring 2008 the real estate deal market was put on ice, and this is one of the most important sectors of activity of the company”, Lionachescu told Wall-Street.

In July last year, Piraeus Bank would acquire 51% equity in Cypriot-based Finnagan Holdings Limited, company that owns 100% of Capital Partners. The deal, estimated at 32 million euros was ground to a halt, the two parties agreeing to an assistance accord.

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