BRD reports profit down 19% in Q1

Thus, the net costs of credit risks soared to 201 million lei (47 million euros), from 62 million lei (17 million euros) a year earlier.

“The profit contraction is largely due to the growing credit-risk related expenses but which may be deemed manageable under current market conditions. Given the first-quarter non-recurring revenue, the decrease of after-tax financial results would be in the range of 7%”, BRD announced.

The bank’s asset book amounted to 50.6 billion lei (11.9 bln euros)at the end of March 2009, up slightly from prior-year quarter.

“We have seen a sharp deterioration of credit demand and an increase in risk-related costs. These two factors were fueled by a weakening of the economic activity and high interests. In this context, BRD, who had anticipated this situation, has adopted new strategy by focusing on its flexibility and its pool of services and products. It is notable that although the credit risk-related expenses were significantly higher than last year, they should stay below the banking system average”, said Patrick Gelin, CEO-managing director of BRD – Groupe Societe Generale.

The banking net revenues stood at 815 million lei (191 million euros), 18% up from the quarter ending in March 31 2008, while gross operating profit went 20% up from a year earlier, to 460 million lei (108 million euros).

The bank’s loan portfolio amounted to 33 bln lei (7.7 billion euros), 19.5% up from prior-year period. Loans for natural persons stood at 16 billion lei, up 17% while corporate loans hiked 22% up to 17 bln lei.

The deposits volume increased by 9.4% from a year earlier, up to 29.6 billion lei.

The return on equity was 20% in Q1, while costs/revenues ratio was 43.6%, the bank informed.

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