NBGs Romania operations show 23% decline in profit

National Bank of Greece’s profit in Romania fell 23% in the nine months through September this year compared to the same period of 2008, to €17 million, while pre-provisions profit grew 27% to €49 million.
In the first nine months of 2008, National Bank of Greece (NBG) that holds Banca Romaneasca, reported profit €22 million for its Romanian business, while pre-provision profit stood at €39 million.

After the first half of 2009, NBG said its profit for Romania operations stood at €12 million, and pre-provision profit at €32 million.

NBR reported net interest income of €90 million for its Romanian business at the end of September 2009, 13% more than €79 million year-ago period.

Income from bank fees and charges and other sources amounted to €11 million, down 1%. NBG’s operating expenses fell 1% to €52 million, the bank said in the report.

The bank’s total lending in Romania remained at 2008 level, of €1.163 billion, and increased 2% from the end of previous quarter. Retail lending totaled €964 million in the nine months ending September 30, down 6.6% from end-2008 and 7% from the same period of last year. NBG’s lending to companies increased in the first nine months this year by 2.65% from end-2008 to €1.2 billion and advanced by 6% from year-ago period.

Retail deposits amounted to €1.027 billion, up 34% from December 31, 2008, and 41% more than September 2008.

NPL ratio in the bank’s loan book continued to rise in third quarter 2009 to 3.1% at the end of September 2009, versus 2.2% from the end of first half and 1.2% end-2008.

The cumulated provisions of the group covered 89% of debt in arrears, also taking into account the various forms of collateral associated with debt.

The report says NBG’s capital flows in Romania stood at €925 million at the end of September 2009, €408 million below end-2008 levels.

Banca Romaneasca operates in the Romanian market for 16 years. It has a common capital of over €200 million and a network of 151 outlets across the country.

In October 2003, the Greek-based National Bank of Greece (NBG) bought majority interest in Banca Romaneasca, and now holds 89.07% equity. Another shareholder of the bank is the European Bank for Reconstruction and Development with 10.21% stake.

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