Romania's Patria Bank swings to 9-mo profit

Net banking income increased by 11% year-on-year to 127 million lei, supported by the growth of loan portfolio, Patria Bank said in a statement filed with the Bucharest Stock Exchange on Friday.

During the first nine months of 2019, the actions for the sale of the bank's non-productive assets continued. In January, Patria Bank sold a total of 331 million lei portfolio of non-performing loans to KRUK Group.

The net income from fees and commissions rose by 18% to 19.9 million lei, sustained by the new initiatives to diversify the range of commission revenues that were implemented for legal entities and individuals.

The bank's loan portfolio in Romania increased by 7% on the year to 1.62 billion lei in the first nine months of 2019, while customer deposits fell by 33% to 2.73 billion lei. The ratio of net loans to deposits reached 65.33% as at the end of September 2019, compared to 56.61% at end-2018.

Patria Bank's non-performing loan (NPL) ratio dropped to 12.74% at the end of September, from 18.14% at end-2018. The coverage of NPLs with provisions rose to 49.56%, from 43.53% at the end of 2018.

For the next period, the bank intends to continue its strategy of streamlining processes and significantly reducing operational costs by implementing several strategic projects such as new features for internet banking and mobile banking platform, it said.

In September 2019 Patria Bank carried out an operation to consolidate the capital base by successfully launching and closing an issuance of unsecured, non-convertible and subordinated bonds amounting to 5 million euro ($5.51 million). Formalities for the admission to trading of the bonds on the regulated market operated by the Bucharest Stock Exchange are currently underway, the bank said.

Patria Bank Romania is owned by Patria Bank Group, whose main shareholder is the Emerging Europe Accession Fund (EEAF) equity fund.

In April 2017, a Bucharest court approved the merger of Romanian lender Banca Comerciala Carpatica and its majority owner Patria Bank.

Patria Bank's shares traded 2.16% lower at 0.1135 lei by 1134 CET on the Bucharest Stock Exchange, BVB on Monday.

(1 euro=4.7667 lei)