August 4 (SeeNews) - Austria's Erste Group said on Friday the net profit of its majority owned Romanian unit, Banca Comerciala Romana (BCR), halved to 305 million lei ($77 million/ 66 million euro) in the first six months of 2017, compared to 636 million lei in the same period of last year.
The decline was mainly due to the base effect resulting from the recording of consistent revenues from the sale of holdings and reps in the balance sheet in the first half of 2016 and of risk provisions generated by recoveries from non-performing loans in the first half of 2015, Erste Group said in its H1 2017 unaudited, consolidated financial statement.
The non-performing loans (NPLs) ratio decreased to 10.8% at end-June from 13.5% a year earlier, while NPL coverage ratio rose to 91.1% from 81.1%.
BCR's operating profit rose 3.3% year on year to 151 million lei in the first half of the year, while operating income edged down 3% on the year to 307.4 million lei. Net interest income declined by 6.8% to 183.8 million lei due to lower income from lending business and lower unwinding effects, while net fee income was 5.2% lower at 74.7 million lei on the back of lower transaction and account maintenance fees in the retail business.
The bank's cost-to-income ratio dropped to 50.9% from 53.9% in the first half of 2016.
The bank's total assets rose to 14.5 billion lei at end-June from 14.13 billion lei a year earlier.
BCR, Romania's top lender in terms of assets, had 3.1 million clients, 513 units and 7,016 employees at end-June.
($=0.8442 euro)