Market competition has been one of the factors behind thedecline in BRD's commission revenues in the first half of the year,alongside the introduction of the new regulations on earlyrepayment commissions, says Guy Poupet, president of BRD-SocGen,the second-largest bank on the Romanian market in terms ofassets.
"The decline in net revenues from commissions was generated bythe decline in the volume of activity, by the introduction of newregulations on early repayment commissions, as well as by marketcompetition, which forces us to lower commissions in order topreserve our position," Poupet told ZF in an interview.
Net revenues from commissions fell by 2% in the first half ofthe year, which contributed to a 13.7% decline in net profit, to367 million RON (88.5 million euros).
A major factor set to boost competition among banks over thenext period is the emergency ordinance on credit contracts thatentered into force in June, but which the Government has justcommitted to modify to the IMF so that it would no longer apply toold loans.
In compliance with the ordinance, BRD has dropped earlyrepayment commissions, which used to amount to up to 5%, cappingthem at 1% for loans with fixed interest rates if the repaymentoccurs more than a year ahead of maturity, and a zero commissionset in the case of loans with a floating interest rate.
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