Profit of largest Romanian lender Banca Transilvania surges by 43% y/y in H1

Banca Transilvania (BVB: TLV), the largest bank in Romania by assets, reported its net profit surged by nearly 43% y/y to RON 1.81 billion (EUR 360 mln)in H1 while the profit of the entire financial group rose to RON 2.15 bln, up 35.7% y/y.

The contribution of non-bank subsidiaries and equity participations to the group’s profit increased by only 7.4% y/y.

The group’s stock of loans and deposits rose well above the market average, by more than 13% y/y as of June 2024.

Besides organic growth, the group’s expansion will be boosted in the coming years by the acquisition of OTP Bank Romania and its subsidiaries.

The group’s positive financial evolution was based in H1 this year on the increase in the portfolio of net loans and lease receivables, which were 13.4% up y/y, reaching RON 78.8 bln. The volume of TLV’s customers’ deposits, at the individual level, rose by 13.5% y/y, reaching RON 139 bln.

Consequently, the group’s operating revenues rose roughly a quarter to RON 4.6 bln.

Banca Transilvania has a market capitalisation of RON 26.26 bln (EUR 5.28 bln) after the price of its shares rose by 70% y/y. The dividend paid out of last year’s profit resulted in a yield of 3.81%.

During the first six months of the year, Banca Transilvania financial group took further steps towards its growth through the acquisitions made in Romania, both in banking and complementary areas.

In February 2024, Banca Transilvania signed a sale-purchase agreement with OTP Group to acquire the Romanian subsidiaries of OTP: OTP Bank Romania, OTP Leasing Romania, OTP Factoring Romania, OTP Consulting Romania, OTP Advisors Romania and OTP Bank Romania Foundation. On July 30, having received the authorities’ approvals, Banca Transilvania announced the completion of the acquisition.

Separately, the group reached an agreement in May 2024 to acquire BRD Pensii, a company active in Romania in the field of mandatory (Pillar II) and optional (Pillar III) private pensions. The acquisition requires the approval of the Financial Supervisory Authority in Romania.

(Photo source: Banca Transilvania)