Provisions are set to be problematic this year, as well, makingit virtually impossible to approximate the net profit, says RaduGhetea, chairman of CEC Bank, the only top-ranking bank held by thestate.
"We cannot think that we will set up lower provisions than lastyear. Just as we are talking now and an insolvent client may decideto go bankrupt. Things are very uncertain," Ghetea told a pressconference on the release of the bank's 2010 results.
CEC Bank last year posted a 65 million-lei (15 million-euro)gross profit, up 30% in lei terms against 2009. The bank had 365million lei (87) in provision spending, nearly 9% more in lei termsthan in the preceding year.
"2011 did not start better than last year, things are stillbad."
The pessimism displayed by Ghetea, who is also chairman of theRomanian Banking Association, is at odds with the somewhat moreoptimistic message sent by other bankers, who are hopefulcompanies' businesses will rebound at least in the second half ofthe year. Bankers were optimistic in the spring of 2010, as well,but the tough measures taken by the Government in the summer toadjust the budget (the 25% cut to public sector wages and raisingVAT from 19% to 24%) upset everyone's plans.
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