BCR's five-month profit, 73 million euros

Banca Comerciala Romana (Romanian Commercial Bank – BCR) concluded the first five months of this year with 3,000bn ROL (some 73 million euros) in net profit, over 60% more than in the same time in 2003.

The assets went up about 29% to more than 200,000bn ROL (approximately 5bn euros), while the bank’s equity capital rose 27% to some 33,000bn ROL (807 million euros).

Credit volume five months through the year had reached 87,000bn ROL (2.1bn euros), up 45% compared with January-May 2003. The deposits attracted by the bank increased 22% from May 2003 to 140,000bn ROL (3.5bn euros).

BCR concluded 2003 with 4,904.65bn ROL net profit, down 10.94% from 2002. The decline in euros was much sharper, considering the euro gained 17% against the domestic currency last year.

This spring, after many months of talks, the European Bank for Reconstruction and Development (EBRD) and the International Finance Corporation (IFC), World Bank’s investment arm, bought 25% plus two shares in Banca Comerciala Romana. The two financial institutions paid 222 million euros for the stake they bought from the Romanian State. This means the bank was appraised at 888 million euros.

The other shareholders of the bank are as follows: the State Assets Resolution Authority (AVAS) – 44.8%, SIF Oltenia – 6.11%, SIF Banat-Crisana – 6%, SIF Transilvania – 6%, SIF Moldova – 6% and SIF Muntenia – 6%. The bank’s employees will be allowed to buy 8% for which they will pay three times less per share than EBRD and IFC did.

Several international financial groups are interested in buying the rest of the state-owned stake. HVB, Germany’s second largest financial group, has shown the keenest interest of all, considering it wants to expand presence in the Central and Eastern Europe and in Romania mainly. The State may redeem the 25% acquired by EBRD and IFC, which it may later sell.

Banca Comerciala Romana is the largest bank in the Romanian banking system and accounts for 30% of the market. Second top bank is BRD – 15%. BRD logged 21 million-euro net profit in the first quarter, up 110%. BRD is controlled by French Societe Generale Group and its market capitalisation reaches 915 million euros.

First half results across the banking system are carefully monitored by analysts so as to see whether the consumer lending slowdown made a significant impact on the banks’ financial statements.

Banks saw a consumer-lending boom last year, which trend grew stronger in the first two months of 2004 only to plunge later, once the National Bank of Romania introduced new more restrictive lending regulations.
miruna.lebedencu@zf.ro