CEC Bank, a lending institution controlled by the Romanian state, in H1/2024 saw its net assets rise to RON93.2 million, a 35% increase against the same period of 2023.
The Bank’s net interest YOY income increased by about 27% in 1H 2024 (respectively by approximately RON211 millionn), due to the increase in interest income, generated by the monthly increase in the balance of loans and investments (securities, interbank placements, etc.). Thus, interest income increased by about RON673 millionn, while interest expenses also registered an upward trend, up by about RON462 million.
Net income from commissions increased by about 4.1% (respectively by approximately RON5.5 millionn), reaching RON139 millionn for the Bank (and RON157 millionn at Group level) in the first half of the year.
The administrative expenses of the Bank registered approximately 15% increase YOY, mainly due to the additional tax on turnover. In the absence of this tax, which was not transferred to customers through higher margins/commissions, the increase would have been only around 4%, generated mainly by the increase in amortization expenses – a result of investments made within the Transformation Program, investments in the modernization of the territorial network and the ATM/MFM fleet, as well as the increase in salary expenses.
Based on these developments, the cost/income ratio of the Bank improved, reaching 51.61% in 1H 2024, compared to 54.07% in 1H 2023. The expense with the cost of risk increased simultaneously with the improvement of the degree of non-performing loans coverage with provisions (from 57.8% to 60.1%), in line with the sustained growth of the loan portfolio.
Over 34,000 new loans were granted during 1H/2024, with a cumulative value of approximately RON5.8 billon.
CEC Bank is one of the first commercial banks in Romania to add to its portfolio of products loans with free guarantees insured by FEI, to increase the competitiveness of SMEs and for the sustainability of SMEs and small businesses with medium capitalization, as part of the Guarantee Agreement signed with the FEI within Invest EU – The compartment for the member state Romania.
The new loans granted to companies in the first half of 2024 are worth over bn 4.3 RON, of which bn 1.75 RON were granted to new customers entering the bank’s portfolio. We focused on supporting the investment projects of existing clients, but also on diversifying the portfolio. The main areas of activity financed by the Bank, in correlation with the programs and projects of national and regional interest, were: agriculture, industry, trade, constructions.
The Bank also acted as leader to a syndicate in structuring a financing worth EUR20 million for the Aaylex Group (Cocorico) and also participated as a mandated arranger within a large syndicate for Transgaz financing, along with other important banks in the system, with an amount of RON180 million.
Agriculture and food industry registered the greatest increase in CEC Bank’s portfolio, the balance of loans and financing commitments increasing up to RON6.75 billion (+44.6% YOY). The new loans granted to the Agricultural sector were worth RON1.7 billon. The Bank maintains its focus on lending to Agriculture and Food Industry, being the second area financed with a weight of over 20% in the total portfolio.
More than 30,000 Romanians benefited from financing amounting RON1.5 billon, for real estate investments or for other personal projects. The volume of loans granted increased by 63%.
(English version by Catalina Apostoiu)