Romania’s banking system ranked second in Europe by profitability at the end of last year, after Hungary’s. Despite taking the top spot, its ROE dropped slightly in the first quarter, from 15.7% at the end of 2016. Second most profitable banks in Europe are those in Czech Republic, 15.5% ROE, followed by Latvia’s, 14.5%.
Romania took the top spot by profitability despite being placed in the upper section of the ranking by non-performing loan ratio. Its NPL ratio stood at 9.9% at the end of the March, almost double the EU average.
Lenders in Romania posted a record high profit of RON1.2 billion in January-March this year, after having ended 2016 with RON4.3 billion. If their profits remain comparable in the following quarters, 2017 might be a record year for profit. The profits of the top three banks by assets, BCR, Banca Transilvania and BRD-SocGen accounted for about two thirds of the total banking system profit.
The banking sector had four years of losses since 2008 and as many in the black. Losses in 2010, 2011, 2012 and 2014 stood at RON8 billion, while 2009, 2013, 2015 and 2016 profits amounted to almost RON10 billion.
(English version by Loredana Fratila-Cristescu)