In H1 2022, Banca Transilvania recorded a net interest income growth of 33%, net fee and commission income increase of 23%, operating income growth of 18%, and a net profit of RON 1.05bn, an increase of 3% YoY.

The Group’s net interest income amounted to RON 2.03bn, an increase of 33% YoY, driven by the increased level of lending. In fact, 140k loans were granted by the bank during H1 2022, with a total value of RON 14.2bn. In total, as compared to the YE 2021, the balance of loans granted by the Group reached RON 64.9bn, an increase of 15.6% compared to YE 2021. Also, the Group attracted 285k new customers, reaching 3.75m. Net fee and commission income also increased, growing by 23% YoY to RON 550.9m. Combined, this led to an operating income of RON 2.83bn, an increase of 18% YoY.

During the same period, operating expenses also increased significantly, growing by 31% YoY and amounting to RON 1.63bn. The growth was driven by higher impairments on financial assets, which increased by 36% YoY and amounted to RON 204.8bn. At the same time, higher personnel expenses also occurred, growing by 26% YoY and amounting to RON 818.5m. Other operating expenses also increased, growing by 47% YoY and amounting to RON 446.3m. The impairment increase can be attributed to the current macroeconomic uncertainty, and the Company is preparing for all eventual scenarios in the near future, increasing this number. Personnel expenses can be attributed to the double-digit inflation growth that Romania has recorded for the last few months, meaning that Banca Transilvania has to offer higher wages, thus driving personnel costs.

Due to strong operating expenses growth, the impact on the profit before taxes was recorded, with it growing by 3% YoY and amounting to RON 1.2bn. Finally, the H1 2022 net income increased by 3%, growing to RON 1.05bn.

Banca Transilvania key financials (H1 2022 vs. H1 2021, RONm)

Moving on to the balance sheet, the total assets of the Group increased by 6% compared to the beginning of the year and amounted to RON 140.1bn. The growth was driven mainly by an increase in financial assets at amortized cost, which increased by 41% YTD and amounted to RON 95.3bn. This, in turn, was driven by higher loans to customers, which increased by 14% YTD and amounted to RON 62.2bn, as well as higher amounts of debt instruments, which increased by 16x YTD and amounted to RON 24.7bn. Meanwhile, placements with banks decreased by 34% YTD and amounted to RON 10.3bn. Meanwhile, financial assets measured at fair value also decreased, declining by 51% YTD and amounted to RON 20.2bn.

On the other hand, total liabilities amounted to RON 130.2bn, an increase of 4% YoY. This increase was driven by higher deposits from customers, which increased by 3% YoY and amounted to RON 110.9bn. Loans from banks increased by 59% YoY and amounted to RON 12.6bn. Deposits from banks increased by 43% YoY and amounted to RON 1.46bn.