BRD profit lower year-on-year, but above estimates

BRD-Groupe Societe Generale, the second largest lender locally, posted financial results for the first half of 2009 significantly above analysts' expectations.

The lender earned more than €90 million from forex operations, state bonds and derivate product transactions, double year-on-year. According to financial analysts, data shows that the lending deadlock registered since the end of 2008 on the local market has forced banks to boost operations on the currency market in order to increase their profit.

Overall net income registered by BRD - lending and other operations included, amounted to RON 425 million (€100.5 mln), while experts were foreseeing a 24 percent drop in earnings, due to higher provisions and interest rates for deposits, and lower revenues from fees and interests. The decline announced by the local subsidiary of French SocGen lender was only 17.4 percent compared to the first half of 2008. Furthermore, the loan balance dropped slightly to RON 32.2 billion (€7.6 bln), from RON 32.265 billion (€7.62 bln) registered at the end of 2008. As far as the second quarter is concerned, earnings dropped 16 percent year-on-year, but rose a mere 2 percent compared to Q1, to RON 215 million (€50.8 mln).

"The first quarter of 2009 was marked by a significant slowdown in lending demand and a sharp increase in risks for individual and [small and medium-sized enterprises] SME clients. This proves the magnitude of the economic recession that was felt in the first quarter," the lender's President and CEO, Patrick Gelin, said. "Amid this background, BRD managed to secure satisfactory results. Due to the efficiency of its internal proceedings, general cost cutting measures, and the quality of its portfolio, BRD has proven its ability to cope in a difficult environment," Gelin added.

standard.money.ro