Lenders’ net profit shrank by 19.5% year on year in 2020, due to the deterioration of the macroeconomic environment amid the COVID-19 pandemic, which required higher provisions for potential loan repayment difficulties of customers.
The profit of the banking system stood at RON6.39 billion in 2019.
Return on assets (ROA) and return on equity (ROE) reached 0.98% and 8.86% at the end of December 2020, lower than in 2019.
Lending saw moderate growth of 5.1%, interests went down, and the economy shrank by 3.9%, due to the freeze caused by the pandemic.
Banking system’s assets rose to a high of RON560.1 billion in 2020, RON64.9 billion more than in 2019.
The solvency ratio, one of the most important indicators Romania’s central bank monitors, which shows how well capitalized a bank is, went up to 23.18% in December 2020 from 22% in 2019.
Loan-to-deposit ratio stood at 65.89%, below the December 2019 level, 70.99%. Non-performing loan ratio dropped to 3.83% at the end of 2020, compared with 4.09% in December 2019.
(English version by Loredana Fratila-Cristescu)