The 37 banks active on the Romanian market ended 2016 with net assets of RON 393.9 billion (EUR 86.7 billion) and total cumulative profits of RON 4.33 billion (EUR 954 million), due to lower non-performing loans, National Bank of Romania (BNR) data reveals.
Thus, at December 31, 2016, the average rate of bad loans for the entire banking sector fell to 9.46 percent, from 10 percent in September 2016 and 13.51 percent in December 2015.
At the same time, the solvency ratio at banking sector fell slightly at the end of last year to 18.33 percent from 18.76 percent in September 2016, but remains significantly above the minimum level required by banking rules, of 8 percent, according to central bank.
Banks’ assets in Romania increased by 4.4 percent last year from RON 377.2 billion at the end of 2015, while profitability has cut.
After years of losses, the local banking system returned to profit in 2015, being the best year after the crisis for financial institutions’ shareholders. Two years ago, the banks in Romania have achieved a cumulative profit of RON 4.68 billion, corresponding to a return on assets (profit based on total assets) of 1.24 percent compared with 1.10 percent – RON 4.33 billion profit – in 2016.