UniCredit Tiriac Bank, Romania’s fourth largest lender, posted a consolidated net profit of EUR 23.9 million for the first half of 2014, 42% lower than in the same period of last year.

The bank’s operating revenues increased by 10%, to EUR 170 million, mainly due to higher net interest income, as the group increased its loan portfolio. The gross loan book reached EUR 4.93 billion, at the end of June 2014, with loans to SMEs 10.4% higher compared to June 2013 and loans to retail up 13.5%, the bank announced. Net loans were up 3.6% y-o-y to EUR 3.86 billion.

This was supported also by the takeover of RBS Romania’s retail portfolio in the second half of 2013.

UniCredit Tiriac Bank announced that it will also take over RBS Romania’s corporate portfolio later this year, which will further contribute to increasing the bank’s assets. Total assets at the end of June 2014 were EUR 6.6 billion.

The bank’s net operational profit also increased to EUR 85 million in the first half of 2014, up 10.5% year-on-year. However, this was partly canceled by the increase in risk costs by some 16%, to EUR 53 million. Thus, the gross profit was only slightly higher than in the first six months of 2014 (2.5%), at EUR 32 million.

The drop in net profit is due to the fiscal treatment which the bank benefited from, in 2013, for its state bonds portfolio. Last year, the bank didn’t pay any tax on profit, but received money from the state, after the release of deferred tax related to prudential filters set up in 2012.

Andrei Chirileasa, andrei@romania-insider.com