The lender is due to publish financial results for the first quarter today, and the five analysts questioned are anticipating a drop in net profit, with prognoses varying from RON 55 million (€13 mln) to RON 212.7 mln (€50 mln). Banks have been affected by an accelerated increase in provisions, with almost half of local players registering losses in the first quarter. BCR, banking market leader, reported a net profit for the first three months of €78.3 mln, 13.7 percent lower year-on-year, having pumped some €72.6 milion into provisions. BRD’s assets are due to increase 22 percent, to RON 50.39 billion (€11.9 bln). Representatives of EFG Eurobank Securities, KBC Securities, KD Capital Management, Tradeville and Wood&Company participated in the Reuters poll.
BRD representatives insist that the bank will continue to be profitable, although profit this year could be subject to a 10-15 percent drop, or even stagnation, depending on the evolution of the economy.
Most specialists believe that the Romanian economy contracted in the first quarter, with “major blows” to industry due to a drop in demand, while the lending segment was affected by a weakening leu, an increase in unemployment, and heightened uncertainty in terms of the economy. The General Manager of BRD said recently that provisions budgeted to cover possible losses in the lending segment could double this year, to a high of 1 percent of the bank’s total loan portfolio.
