Raiffeisen sees profits decline in Romania on higher provisions, lower revenues

Austrian group Raiffeisen Bank International (RBI) saw its profit after tax decrease by 27.5 percent in Romania, in the first quarter of 2014 (Q1 2014), to EUR 22 million, on growing provisions and lower revenues, according to the group’s quarterly report. The group posted a 2.8 percent decline in operating revenues, to EUR 112 million, due to lower net interest income, which was down by 6.1 percent, to EUR 67 million. The bank’s net interest margin in Romania shrunk to 4.36 percent in Q1 2014, from 4.83 percent in Q1 2013, due to lower interest rates for RON. This led to a 3.4 percent decrease in operating result, to EUR 49 million. However, net provisioning grew by 21 percent, to EUR 26 million. Raiffeisen International’s assets in Romania decreased by 1.7 percent March 2014 compared to March 2013, to EUR 6.26 billion. However, its loan portfolio was up 3 percent, to EUR 4.32 billion, with retail loans as its main driver. Deposits from clients were also up 3.3 percent tear-on-year, to EUR 4.13 billion. The loan to deposit ratio is close to 105 percent. Raiffeisen has 5,329 employees in Romania and 530 business outlets. The group serves over 2.05 million Romanian customers. Andrei Chirileasa, andrei@romania-insider.com