Banca Transilvania posts 26% drop in 2020 net profit

Romania’s Banca Transilvania [BSE:TLV] said that its net profit fell by 26% year-on-year in 2020 to 1.197 billion lei ($300 million/246 million euro), according to SeeNews.com.

Last year’s positive results are due mainly to an increase in the volume of operations and adequate cost management, the bank said in an unaudited annual financial report filed with the Bucharest Stock Exchange, BVB, on Thursday evening.

“We are satisfied that our results exceeded the conservative forecasts of the initial budget. In 2020 we proved again that we have adapted and that we have an experienced and strong team, which can deliver great results even within such a complicated context,” Banca Transilvania chairman of the board of directors Horia Ciorcila said.

The bank’s operating income fell 2.33% on the year to 3.93 billion lei in 2020, while operating expenses were 6.17% lower on the year to 1.78 billion lei.

Net interest income dropped by an annual 3.91% to 2.58 billion lei, while net fee and commission income was 7.88% lower on the year to 656 million lei in 2020.

At the end of 2020, Banca Transilvania’s assets were 18.2% higher on the year at 103.3 billion lei.

Net loans increased to 40.36 billion lei at the end of 2020, up by an annual 4.56%. In 2020, the bank granted 22,000 new loans amounting to 2.9 billion lei to over 9,500 small and medium-sized enterprises and micro-customers. It granted over 67,300 consumer loans amounting to 2.4 billion lei last year. More than 41,000 individual and legal entities clients had their installments deferred by the bank because of the coronavirus pandemic and over 400,000 credit cards were exempt from monthly repayments for three months.

Customer deposits reached 90.94 billion lei in 2020, up by an annual 18.75%. Of the total, 61.94 billion lei are deposits of individual customers and 29 billion lei are deposits of legal entities.

Non-performing loans accounted for 3.46% of Banca Transilvania’s total loan portfolio at the end of 2020, while their coverage with related provisions and mortgage collaterals reached 133%.

Blue-chip Banca Transilvania is the largest Romanian privately-owned bank, part of Banca Transilvania Group.

The group, which also comprises Moldovan lender Victoriabank, BT Leasing Transilvania IFN, BT Direct IFN, BT Microfinanţare IFN, BT Leasing MD and BT Asset Management, posted a net profit of 1.476 billion lei in 2020, down by 20% year-on-year. Group assets totalled 107.53 billion lei at the end of 2020, up by annual 17%.

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