Lower provisions help Raiffeisen double profit to 37m euros

Raiffeisen Bank, a top ten bank controlled by Austrian group Raiffeisen International, posted a 37 million-euro net profit in the first quarter, 117% higher than in the similar period of 2009, after halving its loan-loss provisions, to 16 million euros.

According to data published by the Vienna parent bank, the bank posted a 2 million-euro net loss in the fourth quarter of 2009, after setting up 64 million euros in provisions, in the context where Raiffeisen International consolidates all operations in Romania and the Republic of Moldova.

Bogdan Popa, the executive in charge of financial control and accounting, says in the first quarter the rise of non-performing loans slowed down against previous periods, the first quarter of 2009 included.

“As a result of the bank’s prudent provisioning policy in 2009 and the high degree of provision coverage, loan-loss provisions fell significantly in the first quarter of this year,” Popa explained.

He added that the bank had cut its funding costs, benefiting from the improved liquidity in the banking system, which reflected in lower pressure on attracting deposits.