Wednesday, May 6, 2009

Romania's BRD Q1 net falls 19 pct, beats consensus

* Q1 net falls 19 pct to 210 mln lei vs f'cast 158 mln

* Hit by the economic downturn and rising provisions

* Loan-loss provisions more than triple to 201 mln lei

BUCHAREST, May 5 (Reuters) - Romania's No. 2 bank BRD BRDX.BX posted a 19 percent fall in first-quarter net profit on Tuesday, reflecting rising loan-loss provisions and the effects of the economic downturn.

Net profit at BRD, controlled by France's Societe Generale (SOGN.PA), dropped to 210 million lei ($67 million) compared with a forecast of 158 million lei in a Reuters poll.

Risk costs or loan-loss provisions reached 201 million lei compared with 62 million in January through March 2008. Net banking revenue rose 18 percent to 815 million lei, while the total loan book rose by 19.5 percent on the year to 33 billion.

"We noticed a powerful drop of lending demand and a significant increase in risk costs ... because of a reduction in economic activity and a very high level of interest rates," BRD Chief Executive Patrick Gelin said in a statement.

In a Reuters interview last week, Gelin said loan-loss provisions could more than double to up to 1 percent of the total loan book this year.

He said the bank would remain profitable, but this year's earnings could be anywhere from down 10 to 15 percent to roughly flat, depending on economic growth. (Reporting by Marius Zaharia; Editing by David Holmes)

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