Banca Transilvania, the largest bank in Romania by assets, reported its net profit dropped by 40% in the first quarter of the year (Q1) to RON 261 million (EUR 53.8 mln).

The entire financial group Banca Transilvania reported a net profit of RON 304 mln (EUR 62.7 mln), also down 40% compared to the same period last year.

"We had a strong start of the year, but, after the first two months, we had to quickly adapt to a new reality and we shifted our focus on supporting customers, the economy, authorities, and communities," said Banca Transilvania CEO Ömer Tetik.

His statement suggests that the lower net profit was due to the COVID-19 crisis.

"We have a significant market share both in the Retail and in the SME sector, and we assume this role of supporting the overall economy. The bank is financially strong and has the right internal infrastructure to assist its customers and community. The first-quarter results underline this once again," he added.

Banca Transilvania's Chairman, Horia Ciorcia, who is also one of the group's founders and largest shareholders, wrote a letter to the bank's shareholders, thanking them for their confidence.

"The current situation is a challenge for Banca Transilvania too. It means another reinvention for BT, the fourth during its corporate existence - in fact, an adaptation to an unprecedented situation," Ciorcila wrote. "The bank's financial position, the strong liquidity, and robust capitalization, the sustainable approach, the investments made so far in digital, all help us navigate through this period with confidence," he added.

Banca Transilvania's shareholders approved the targets for the bank's activity this year and the distribution of RON 600 mln (EUR 123 mln) as dividends from last year's RON 1.62 bln (EUR 334 mln) net profit. The bank will also increase its capital by RON 522 mln by capitalizing some of last year's profit. For this year, Banca Transilvania plans a gross profit of RON 608 mln (EUR 124 mln).

The assets of Banca Transilvania group reached RON 96.6 bln (EUR 19.9 bln) at the end of Q1, when the stock of loans increased to RON 41.1 bln (EUR 8.5 bln). Customers' deposits reached RON 78.45 bln, out of which, RON 54.7 bln are household deposits, and RON 23.73 bln are corporate deposits.

Banca Transilvania had a capitalization of RON 9.9 bln (EUR 2 bln) as of April 30.

editor@romania-insider.com

(Photo source: Banca Transilvania)