A year earlier, BCR, a unit of Austrian Erste Group Bank (EBS.RO), reported a net profit of RON494.5 million.
In the third quarter of 2011, the group swung to a loss of RON90.5 million, versus a net profit of RON6 million in the same period of 2010.
“Economic recovery is slower than expected and is affecting the business of our customers, their revenues and their transactions with BCR,” said Dominic Bruynseels, Chief Executive Officer of BCR.
The bank said net expenses with risk provisions for loans and down payments was RON1.61 billion at the end of September, equal to 20.8% of overall loans.
It said the sector of small- and medium-sized enterprises continues to face severe liquidity shortage and several large companies have defaulted on their debt following restructuring. The sector should gradually recover once economic growth accelerates, BCR said.
BCR Group’s operating revenue fell 11.2% on the year to RON3.15 billion in January through September, due to lower interest rates and reduced profit margins.
On the other hand, net fee income rose 3.2% on the year to RON444.8 million.
BCR said operating costs increased 1.3% to RON1.26 billion at the end of September, mostly due to higher expenses with personnel training and office upgrades.
The group’s tier 1+2 capital ratio reached 10.7% in September, slightly above the central bank’s minimum requirement of 10%.
BCR Group reported total assets of RON74.45 billion, up 1.1% from December last year.
The group’s financial data are un-audited, consolidated and computed according to IFRS.
BCR group includes BCR bank, BCR Banca pentru Locuinte, BCR Administrare Fond de Pensii, BCR Leasing, BCR Asset Management, BCR Securities, Anglo Romanian Bank Limited and BCR Chisinau.
Erste Bank owns 69.4% in BCR. The Austrian group said it has reached an agreement in principle to buy another 24.12% stake in BCR from four of the five minority holders SIFs in exchange of EUR435 million in cash and stock.
The agreement is pending final approval from SIF shareholders.