Companies' liquidity continues to deteriorate
Banks had to deal with over 41,000 cases of bounced cheques and promissory notes for companies in May, with their number going up again after a slight decline in April. The value of rejected payments climbed to 677 million RON (around 161 million euros) in May compared with a little less than 642 million RON in the previous month, according to data from the NBR (National Bank of Romania). The value of rejected payments is almost three times as high against May 2008, while the number of rejected payments doubled. The rise in May of sums rejected for payment, comes after their value had fallen by 3.5% in the previous month, and the number of rejections was down by around 8%. Analysts say they would not be surprised to see bounced debt instruments continue to rise, as a result of worsening economic circumstances. "As long as the economy is in a difficult state, I don't expect an improvement as far as payments are concerned. Economic operators see their liquidity decline, as they have an increasingly hard time collecting bills," said Lucian Anghel, chief economist of the BCR.
Only 2,100 new voluntary pensions clients in June
Voluntary private pension funds (3rd pillar) attracted around 2,100 clients in June, less than in May, when the number of new clients amounted to 2,700, according to data of the Private Pensions Supervisory Commission (CSSPP). The overall number of clients of voluntary pension funds stood at 169,600 at the end of last month. The only fund that managed to attract over 1,000 new clients in June is BCR Prudent (1,068 new participants), with all others recording a much lower figure. BCR Prudent is managed by BCR Asigurari de Viata, but will be transferred to BCR Pensii in the coming period. BCR Prudent is the second-largest fund on the market in terms of number of participants, with 44,600 clients. The leader of the ranking, just as in May, is ING Optim, managed by ING Asigurari de Viata, with 44,600 clients. The fund sealed 408 new contracts in June. The value of net assets managed by voluntary pension funds amounted to 169.6 million RON, 7.1% more than in the previous month. In terms of value of assets, the largest fund on the market is ING Optim, which manages 36.2 million RON.
Exit from CEZ could bring 170m euros into Property Fund's accounts
The Property Fund is putting its stakes in the distribution, sales and services divisions in Czech energy group CEZ (formerly Electrica Oltenia) up for sale, hoping to collect between 600 and 700 million RON (140-170 million euros) for the three stakes. "If we were to collect between 600 and 700 million RON for CEZ shares, it would be a good deal. The Property Fund is legally bound to sell its 30% stake in CEZ Distributie, with Electrica's privatisation contract stipulating that the CEZ group can exercise its purchase option for the remaining stake. As for the two other stakes, we want to sell them because we could negotiate a higher price by selling the three stakes," said Mircea Ursache, chairman of the Supervisory Board of the Property Fund. At the end of last year, the Fund held 30% of the share capital of CEZ Distributie (CEZ Distribution), 30% of CEZ Vanzare (CEZ Sales) and 12% in CEZ Servicii (CEZ Services). According to the latest appraisals made by the Fund, the stake in CEZ Distributie is the most valuable one - 696.4 million RON at the end of 2007.
Holcim: 12 more months of consumption decline
Markus Wirth, chairman and chief executive of Holcim Romania, the local subsidiary of Swiss group Holcim, says he expects a further 12 months of decline for cement consumption, with a slight rise expected as late as in the second half of 2010, provided that investments in infrastructure intensify. "We have said on countless occasions that investments in infrastructure are urgently needed, not necessarily to revive the constructions sector, but the economy in general. Construction sites are insufficient. Moreover, construction companies are owed money by the state for the works performed," said Markus Wirth, asked what he would say to Prime Minister Emil Boc if he met him. Holcim Romania underwent a 20% turnover decline in the first five months of the year, due to the decline in consumption of construction materials, and expects this level to remain the same until the end of the year. The company, which produces cement, aggregates and concrete, posted a 372 million-euro turnover last year, up 25% against the previous year, and a net profit of 111.14 million RON (30.2 million euros), down by around 3% against 2007.
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