In 2019, BRD recorded an increase in net interest income of 8.12% YoY, increase in net banking income of 5% and a net profit decrease of 4%.

As BRD Bank published their preliminary FY 2019 results, we are bringing you key takes from it. In 2019, the Group has recorded a net interest of RON 2.15bn, showing a strong increase of 8.12% YoY. Such a high increase came on the back of the expanding volumes across all customer segments. To be specific, BRD witnessed further retail loan growth (+3.5% YoY), increasing lease financing and loans to large corporates (net loans including leasing up by +4.6%* YoY).

Besides that, net fee and commission income went up by 1.1%, amounting to RON 805.6m. As a result, net banking income amounted to RON 3.27bn, showing a strong increase of 5% YoY.

Going further down the P&L, operating expenses witnessed an increase of 15%, amounting to RON 1.68 which came on the back of higher staff costs and regulatory expenses (cumulated contributions to Deposits Guarantee and Resolution Funds and tax on financial assets), while other costs categories were contained at +2.5% YoY.

The P&L was further boosted by cost of risk write-backs in the amount RON 203.7m driven by strong recovery performance from previously written off exposures, exceptional insurance indemnities payout (recognized in Q3 2019) and good control of risk at loan origination.

In 2019, BRD recorded a lower net profit by 4% YoY (RON 1.5bn), as a result of the above-mentioned increase in operating expenses.

Balance Sheet

The Group’s assets grew by solid 3.7% YoY to RON 57.77bn. Such an increase came mostly on the back of the growth of loans and advances to customers (+2.3% YoY). On the liabilities side, deposits from customers increased by 1.5%, amounting to RON 45.9bn. As a result of the higher loan than deposit growth, L/D ratio increased by 0.5 p.p.to still relatively low 66%, showing room for further loan growth.

In 2019, the Group’s NPL ratio stood at 3.1%, which is still below the system level of 4.3%.