BCR's npls soared 71% in 3 months

The nonperforming loan (NPL) portfolio of Banca Comerciala Romana (BCR) increased 70 percent in the third quarter of this year, to a share of 10.6 percent in total loans at the end of September from 6.2 percent in June 2009.

BCR posted total loans worth RON 45.8 billion (some €10.8 bln, computed at an average RON 4.2292/€1exchange rate) at the end of the first half of 2009, of which RON 2.8 bln (some €0.66 bln) were NPLs. At the end of September, the loan portfolio was worth RON 45.9 bln (some €10.85 bln, at an average RON 4.2277/€1exchange rate) of which NPLs made up RON 4.9 bln (some €1.1 bln).

"In the third quarter, nonperforming loans were mainly affected by the SME [small and medium-sized enterprise] segment and real estate business projects, on which BCR has little exposure compared to the market," according to a statement by the bank. Meanwhile, BCR indicated that it registers "a comfortable nonperforming loan coverage rate, through collaterals and provisions, of some 120 percent."

The NPL ratio posted by BCR at the end of September is the second-highest level among Erste's subsidiaries, after that registered in Ukraine. The net risk costs surged 90 percent in the second quarter alone, to RON 1.48 bln, from RON 783 mln. "We noticed in the retail loan portfolio in Romania a relaxation of arrears, due to the stability of the currency. We expect this trend to continue, because we believe the leu will remain stable at this level in the coming quarters," Erste Group's Risk Manager, Bernhard Spalt, said in a recording published on the Austrian bank's Web site.

standard.money.ro