Romanian banking system's Q1 assets drop modestly

Assets of Romanian banking system dropped 0.08% year-on-year in the Jan-Mar 2010 period to Euro 78.13 billion. In local currency, the industry's assets fell 3.2% to 320 billion lei, according to data provided by NBR. At the end of 2009, Romanian banks' collective net assets totaled 330.6 billion lei. Expressed in euro, at the reference rate set by the National Bank of Romania, the banking system's assets stood at Euro 78.2 billion.

Data were calculated at the reference rate set on December 30, 2009, of 4.2282 lei/euro, and at the March 31, 2010 rate of 4.0958 lei/euro. Compared to the same period of last year the assets of Romanian banking system, calculated in lei, dropped 3.7% to 332.34 billion lei.

Private capital credit institutions had 93% of industry's total net assets, while banks with foreign or majority foreign capital had 85.7% versus 93.7% and 86.6% respectively in the same period of last year.

The banking systems loan to deposit ratio grew 0.44% from end-2009 to 113.24%, but dropped 11.45% from Q1 2009.Of total bank lending, past due and doubtful loans accounted for 1.99%, up from 1.46% in December 2009 and from 0.66% in the first quarter 2009.Past due and doubtful claims had 1.39% share in total banking system assets, versus 1.01% at the end of last year and 0.52% a year earlier.

The industry's capital adequacy ratio rose to 14.73% in the period under review, from 14.03% at the end of 2009 and from 13.16% a year earlier. The statutory capital adequacy ratio is 8%. However, NBR recommends a minimum level of 10%.Return on assets stood at 0.55% in the Jan-Mar period, two-times higher from 0.24% at the end of 2009. On March 31, 2009 ROA was -0.25%. The market's return on equity reached 5.93% at the end of first quarter, double from 2.73% at the end of last year. In the year-ago period, ROE was -2.90%.