Banca Transilvania (TLV) made 340 million RON (102 million euros) net profit last year, 2.8 times higher than in 2006. A large portion of the profit came from the sale of BT Asigurari, reveal the preliminary financial results sent to the Bucharest Stock Exchange.
Out of gross profit worth 403.7 million RON (120 million euro), 173.5 million RON (52 million euros) came from the sale of the insurance unit. The bank's operating income, over 230 million RON (68.8 million euros), exceeded the level budgeted by 44%, say representatives of the bank.
"The second quarter (of 2007 i.e.) was better than the first and we want to continue our strategy to develop and boost profit in 2008, as well. In terms of financial results, client portfolio, capital and resources, we are starting this year on a solid footing," stated Robert Rekkers, chief executive of Banca Transilvania.
He says that the international financial turmoil does not affect the operations of the bank and that it has sufficient resources to continue its growth policy.
Last year, the bank's total assets increased by 71% from 13.8 billion RON (3.75 billion euros), and equity capitals rose by 54% to 1.48 billion RON (400 million euros).
"International turmoil affects the European financial sector, but I have yet to see any significant influence in Romania. We have a prudent policy and I am not afraid if we encounter problems. We've taken steps as far as lending to individuals and SMEs are concerned, in that we are more cautious about the terms applied to approve euro loans and take more precautions, however, we have not increased borrowing costs," Rekkers explained.
The bank set aside reserves worth 76.4 million RON (20.6 million euros) at the end of last year, twice as high against the end of 2006.
Credit portfolio increased by 75% last year to 8.56 billion RON (2.37 billion euros), of which 59% account for loans to legal entities and 41% for loans to individuals. The resources attracted from clients have increased by almost 82% to 10.58bn RON (2.93 billion euros).
The investments of the bank totalled 85 million RON (25.4 million euros) last year, after 116 new branches opened. Banca Transilvania's territorial network thus increased to 457 branches and the number of employees went up by 1,300, to more than 5,800.
Banca Transilvania continues to rely on international financial institutions' support for funding streams, after it received 105 million euros in total funding from EBRD, EFSE and ABN Amro Bank Romania last year.
It might also continue to raise cash through the capital market, by performing capital increases. Most of its profit over the last few years has been reinvested by including it into the share capital.
Asked whether the policy to distribute bonus shares would continue this year or not, Rekkers specified the matter had not yet been discussed with the bank's Board of Directors.
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