Romanian business helps Raiffeisen cut provisions after sale of retail customer loans; profit doubles in nine months

The activity in Romania has helped Raiffeisen International decrease its provisions for South Eastern Europe since the beginning of the year, as a result of the sale of retail customer loans. The bank's provisions in the SEE area reached EUR 227 million, down 33.6 percent on the same period of last year. “In Romania, appreciably less was allocated for loans to corporate and retail customers […]. Improved portfolio quality, restructuring measures and sales of non-performing loans were the reason for that decline,” writes the bank in its third quarter report. Austria's Raiffeisen Bank posted a EUR 33 million net profit from operations in Romania in the third quarter of the year, up over six times on the profit recorded in the similar period of 2009. During the first nine months, the bank doubled its profit, to EUR 85 million in Romania. In South Eastern Europe, net interest income improved by 2 percent, of EUR 14 million. In Croatia and Romania, it rose primarily because of decreased costs for deposits from customers and banks. The payment transfer business in Romania reached EUR 64 million, half of the entire income from the transfer payment business for the bank in the SEE region. Net income from currency related business declined by EUR 23 million in Romania. The bank's office expenses, which were by far the largest items (EUR 226 million), were down 1 percent mainly due to lower rents as a result of closing down outlets in Ukraine and Romania and of rent renegotiation. Raiffeisen International, the holding company of Raiffeisen Bank in Romania, saw its assets in Romania and the Republic of Moldova down 8 percent, to EUR 5.6 billion as of September 30. The bank has 542 outlets in the two countries and employs over 6,000 people. Raiffeisen Bank International posted a nine-month consolidated profit of EUR 783 million, while Raiffeisen International more than doubled its consolidated profit in the first nine months, to EUR 318 million. Raiffeisen Bank International is active on the Austrian market and in Central and Eastern Europe (CEE). editor@romania-insider.com