CEC Bank, the financial institution with the longest tradition and the largest territorial network in Romania, announces a net profit of 114.1 million lei at the end of the first quarter of 2020, increasing by 26% compared to the same period of the previous year.
"We had a promising start to the year. Especially in the first two months of 2020, we recorded a robust growth in the loan and income portfolio, which continued the growth trend of last year. The situation changed after the appearance of the coronavirus pandemic, which determined the abrupt reduction of the economic activity and, implicitly, the decrease of the credit demand after the onset of the state of emergency. After declaring the state of emergency, the Bank focused on measures to ensure business continuity and on solutions for individual customers and companies affected by the crisis. In the first quarter, we continued our efforts in the direction of digitalization and modernization: card payments increased by 50%, and the number of Internet and Mobile Banking users by 40%, compared to the similar period of 2019. During this period, CEC Bank launched a series of new services: mobile card payments, the online enrollment process of new customers, in line with our business plan", said Bogdan Neacsu, President, General Manager of CEC Bank.
Bank’s activity in Q1 2020
In the first quarter of 2020, CEC Bank registered a net profit of 114.1 million lei, an increase of 26% compared to the same period of the previous year. Interest income amounted to approximately 372 million lei, an increase of 15% compared to the first quarter of 2019, and commission income increased by 13%, to about 73 million lei. CEC Bank continued in 2020 to consolidate its position and financial performance. Thus, the net balance sheet assets increased in the first quarter of 2020 to 36.5 billion lei, by 11% more than at the end of 2019.
The balance of loans (gross value) was 20.8 billion lei at the end of the first quarter, slightly higher than at the end of 2019.
The bank granted new loans worth over 1 billion lei in the first quarter, including 773 loans to SMEs worth over 585 million lei.
The sources attracted from the non-banking clientele amounted to approx. 29 billion lei, a 4% increase compared to the end of 2019, and the value of government securities in CEC Bank's portfolio at the end of the quarter amounted to over 10 billion lei, a 32% increase compared to December 2019. In line with strategic objectives, CEC Bank managed to improve its prudential indicators. Thus, the bank's solvency indicator for the first three months is 20.96%, a significant increase compared to the same period of the previous year (16.45% for the first quarter of 2019). The liquidity indicator rises to approx. 200% at the end of the period, double the minimum level of 100% according to the regulations. The rate of non-performing loans decreased to 5.02% on 31.03.2020, standing at a level close to the average in the banking system.
The audited financial results and statements for 2019
The Shareholders’ General Assembly approved the audited financial statements of CEC Bank for 2019. In 2019, CEC Bank obtained a gross profit of 478.98 million lei, the net profit before distribution being almost 400 million lei (399.6 million lei), a 7% increase compared to 2018. The net income from commissions increased by approximately 16.2%, and net interest income had a slight increase, by approx. 3.6%. CEC Bank continued to support Romania's economy, while seeking to improve banking prudential indicators and streamline operational flows.
At the end of 2019, the net asset value of CEC Bank amounted to 32.9 billion lei, increasing by 12% compared to 2018. The bank granted new loans amounting to approximately 6 billion lei, of which 1.7 billion lei - loans for individuals and 4.3 billion lei - loans granted to companies and public authorities. In the natural persons segment, the new loan portfolio had a balanced distribution between home and consumer loans. The number of new home loans from CEC Bank's own offer (2,240 new loans) exceeded the number of loans through the Prima Casa program (1,790 new loans), due to the good interest conditions practiced by the Bank. On the segment of companies, agriculture and industry were the areas to which most new loans were directed: over 5,500 loans for agriculture, worth over 1 billion lei and about 500 new loans for industry, worth over 1 billion lei.
The balance of deposits increased to 27.8 billion lei in 2019 (+ 10.3%), the increase being mainly generated by deposits attracted from individual customers (+1,856.0 million lei). About 78% of the total attracted sources were in the national currency.
At the end of 2019, the bank's solvency indicator improved and reached 23.1% (compared to 17.3% in 2018), given that the bank benefited from a capital increase of 940 million lei. The rate of return on capital was 12.57%, above the average in the banking system (11.19%). The rate of non-performing loans decreased from 6% to 5%, being slightly above the average in the banking system.