BRD-SocGen, the second biggest bank in terms of assets, ended2010 with net income worth almost 501m lei, down 36% from 2009, inline with the Romanian accounting standards (RAS).
This is the biggest income derived on the banking market in 2010,considering only 20 banks made profit, yielding total cumulatedlosses of 304m lei on the entire market. According to some bankingsources, BRD is followed at a distance by Raiffeisen and BCR interms of RAS-calculated net annual income.
"The figures demonstrate BRD's endurance capacity and the soundnessof its business model. Net income suffered a visible decline, by36%, on the rising net risk costs, understandable in a challengingeconomic context, but operating income rose by 8%, standing proofof a satisfying current activity," stated Guy Poupet, BRDchairman.
The main profit source was the interest margin, which went up by36%, while net fee income dropped by 4%, and treasury operationprofit slipped by 17%.
Poupet says the crisis fallout has made an impact the bankingsystem and BRD as well, translating into a "continued weakness" ofactivity volumes and of new loan "production" in particular. At thesame time, the deteriorating asset quality pushed for a 41%increase in provision expenses, to almost 1.6bn lei.
BRD head says the bank has made "significant efforts" to supportoperations with clients, resorting to promotional offers andmarketing activities. However, as inactive clients were dropped andthe pace at which new ones were added slowed down, the clientportfolio shrank by around 45,000 individuals and 8,000companies.
"We're approaching 2011 with caution and a certain serenity givenby financial soundness and the support of the parent-bank".
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