BRD-Groupe Societe Generale, the second largest bank in the system, overshot the 5 billion-euro mark at the end of the third quarter, due to the increase in consumer lending and to funds being attracted from companies.
The bank therefore successfully increased the assets it manages by approximately one billion euros in the third quarter.
The net profit of the bank continued to increase in the third quarter at about the same pace as in the first quarter of this year. The net profit three quarters into the year was more than double the profit in the same period last year.
BRD announced a net unaudited profit of 448 million RON (124 million euros) for the first nine months, an increase of 104% on the corresponding period of 2004. The bank''s assets went up by 77% in euros during the same interval, to 18.3bn RON (5.16bn euros).
By the middle of this year BRD had managed to boost its market share by well over one percentage point, to 14.2%, due to the aggressive expansion of its territorial network. The bank''s network came to total 278 branches by the end of the first nine months, 105 of them bearing the BRD Express logo.
Return on equity at the end of the third quarter amounted to 41%, slightly down from the first half, when ROE reached 43%.
The loans granted by the bank to individual customers have grown by 96% in nominal terms over the last 12 months, compared with an increase of just 28% in the deposits attracted from the population. This represents the exact opposite of the situation seen in terms of companies, with the growth in loans reaching only 14% and the deposits attracted from corporate clients going up by 153%. The highest increase in the bank''s revenues came from the fees component, which progressed by 43% to a total of 336 million RON. However, fees did not fully cover the bank''s operating expenses, which amounted to 425 million RON.
In spite of the significant growth in assets, the bank managed to increase its revenues from the interest margin by just 12%, which stood at 540 million RON (150 million euros). A 27% decline in the provisions made by the bank also contributed to the increase in profits.
The bank''s representatives say that the new lending terms imposed by the NBR and the central bank''s interest policy, which led to a serious decline in the interest on loans, could negatively affect their business in the fourth quarter.
"The environment could be less favourable in the last part of the year, in light of the recent regulations of the NBR and its interest policy," explained Patrick Gelin, the bank''s chairman.
BRD is listed on the Bucharest Stock Exchange where it has had quite a calm few weeks, despite the rather heavy fluctuations seen on the overall market. BRD concluded the day at 13.3 RON/share, down 0.8% from the previous day.
The main shareholder of BRD is French Societe Generale, with 58.3%. The main minority shareholders are the five SIFs, that each own approximately 5% in the bank. If calculated based on the latest quotation from yesterday, BRD''s market capitalisation amounts to 2.56bn euros.
vlad.nicolaescu@zf.ro
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