Record Profit⁢ for Romanian Banking System in S1/2024

The ​Romanian banking system reported a record profit of 7.5⁤ billion lei in the first⁢ half​ of 2024, a 10% increase compared to the ​same period in 2023. This growth was driven by the performance of 26 banks that were in ‍the black,⁢ while 6 banks reported cumulative losses of 79.3 million lei.

Profitability of Major⁣ Banks in ​H1/2024

The big banks in Romania were profitable in the first half of 2024, but their⁣ results were mixed. Some banks⁢ achieved higher profits than in ⁤H1/2023, while others reported lower‍ earnings. This mixed performance occurred in⁣ a context of continued lending and income growth, albeit at a⁢ slower pace due to high interest rates and ‌low risk costs.

Interest ⁤Rates and Bank ⁤Profitability

Interest collected on loans is the primary source of ​profit for banks. In the first half ‌of 2024, interest rates on lei-denominated loans ⁤remained high, despite inflation falling ⁢below 6% and then 5%. The National Bank of⁣ Romania (BNR) began reducing interest rates in July, with ‍further adjustments in⁣ August.⁢ This decrease in interest ⁢rates⁤ is expected to impact banks’ income from interest collected on loans and profits.

Source: AFP