"We expect the annual gross income to slightly exceed 15m euros. We are taking into account narrower profit margins from operations with customers and the unfolding of some extensive projects in the second half of the year," Traian Halalai, 37, chief financial officer of Banca Romaneasca, stated in an interview with ZF.
NBG, a major Greek financial group that bought the majority stake in Banca Romaneasca in 2003, has been poised to conduct a rebranding process for several years.
The group also holds a leasing firm (Eurial) and an insurance firm (Garanta) on the Romanian market. All the domestic subsidiaries will be brought under one brand - NBG. The final names have not been decided, yet. The rebranding process will last until Q1, 2009, with total costs expected to reach between 6 and 7m euros.
The scheduled territorial expansion will be largely carried out in the second half, too. A number of 36 units will open in 2008, with the bank due to reach 158 units by December and 190 by late 2009.
To support the development of its domestic subsidiary, the Greek group added 171m RON (almost 47m euros) to the bank's share capital in May. Another capital raise, of 185m RON (some 53m euros), will be operated towards the end of the year. The group chose this type of financing to shun minimum compulsory reserve costs. Most domestic banks' treasuries are testing cost optimisation methods through complex financing structures.
Banca Romaneasca has retail loans worth 875m euros, 77% above last June's level. On the corporate finance segment, the increase was smaller, by 47%. Starting from a broader base, however, the volume reached 514m euros. Deposits attracted from individual customers climbed by 59% in the past 12 months and reached 349m euros, while on the corporate side raised sources fell slightly to 330m euros. Amid the rapid upsurge in retail lending the group also doubled its provisions to 8.5m euros.
The Greek group has also embarked on aggressive campaigns to attract funds from the population. Besides cost cutting, Halalai says attracting experienced employees remains one of the toughest challenges for the coming period.
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