Romania's Banca Transilvania plans EUR 30 mln issuance of share convertible bonds

Romanian lender Banca Transilvania is seeking shareholder approval for a EUR 30 million bonds issuance to help cover its financing needs. Bonds will be convertible to shares. A decision on this proposal will be made at the shareholders' general meeting on April 27, when a new board member will also be chosen, after Robert Rekkers left the helm of the bank. His seat is currently occupied by Peter Franklin from the European Bank for Reconstruction and Development (EBRD), as interim.

Banca Transilvania's last bonds issuance was in 2005, when the International Finance Corporation bought USD 20 million worth of bonds and turned them into shares in 2009, taking over 3.7 percent of the bank. At a current market capitalization of some EUR 445 million, the EUR 30 million bonds issuance would cover up to 7 percent of the bank, if turned into shares. The EBRD owns 15 percent of Banca Transilvania, Bank of Cyprus has 9.6 percent, while its founder and president Horia Ciorcila has 5 percent. The lender, listed on the Bucharest Stock Exchange, is still majority owned by Romanian shareholders. Banca Transilvania’s net profit was EUR 31 million ( RON 131.8 million ) in 2011, up 35 percent compared to 2010, mainly due to the bank’s revenues from interest, further growth in lending, lower net expenses with provisions, and costs optimization, according to the bank. editor@romania-insider.com