Alpha Bank profits rise threefold to 16.4m euros

Alpha Bank Romania created net profits of 16.4 million euros in 2004, 3.3% higher than in the previous year. Pre-tax net profits reached 21.4 million euros, 60% higher against December 2003.

The bank’s assets reached a volume of 732 million euros, a 35% increase since the end of 2003, while the volume of loans granted by the bank rose during the previous year by 32% to reach 490 million euros and deposits by customers grew by 55% to 334 million euros. The figures were calculated according to international accounting standards (IAS).

“Our business plan for the next three years includes considerable investment in new branches, modern technology, employee training and the development and introduction of new products and alternative distribution methods,” said Christos Giampanas, executive chairman of the bank. He said the bank would be opening new branches in the near future, all of which would be in the capital city.

The bank”s development plan will see their branch network extend to 50 locations by the end of 2007. This growth rate will help the bank’s assets to double over the same interval.

At the same time Alpha Bank plans to implement a new IT system, which is scheduled for completion by the end of the year, after many delays. The new system, which is mainly for the retail segment, will be implemented by the group in various countries of the region.

Representatives of the bank maintain that the profits generated in 2004 represent the most important result of the last 11 years. This performance was achieved amid tighter competition on the market, normally a trigger for lower profits. Higher profitability is also associated with development of the retail segment, which generally achieves higher margins than the corporate segment. Last year the bank’s retail banking segment, which includes both individuals and small and medium-sized enterprises, saw strong growth with the volume of consumer loans rising by 104% and mortgages climbing by 74%. Corporate customers are currently the most important in the bank’s portfolio, with lending in this sector a traditional activity.

Alpha Bank Romania is part of Alpha Bank Group, one of the top players in the financial sector of Greece.

Group officials have recently said they are interested in developing the business in Romania thanks to the high profits of the Romanian subsidiary and the development prospects for this market. liviu.chiru@zf.ro