Tuesday, February 1, 2011
Romania’s Banca Transilvania Profit Rose 58% in 2010
Banca Transilvania SA, Romania’s second-largest publicly traded bank, said 2010 profit rose 58 percent after holding costs in check, as it expects bad loans to peak in a “challenging” 2011.
Net income advanced to 97.85 million lei ($31.5 million) in 2010 from 61.9 million lei a year earlier, the Cluj-Napoca, Romania-based bank said in a preliminary earnings statement sent to the Bucharest Stock Exchange today. Operating income before provisioning rose 27 percent to 775 million lei last year from 610 million lei in 2009.
Banca Transilvania set aside 640 million lei last year for bad loans, 22 percent more than the 524 million lei provisioned a year earlier, as government public-pay cuts and tax increases prevented the economy from recovering from the worst recession on record and made it difficult for businesses and individuals to repay loans. The bank also said it improved its cost-to- income ratio to 48 percent in 2010 from 55 percent in 2009.
“2011 will be full of challenges amid an uncertain national and international economic environment,” Banca Transilvania’s Chief Executive Officer Robert C. Rekkers said in the statement. “We expect a peak in non-performing loans and a decrease in margins.”
Net assets rose 11 percent to 21.6 billion lei last year from 19.5 billion lei at the end of 2009, the bank also said in the statement.
Banca Transilvania’s shares fell 1.4 percent to 1.399 lei in Bucharest trading yesterday, valuing the bank at 1.96 billion lei.
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