Two Romanian Banks Outrank Biggest Banks in Central, Eastern Europe.

Global economic activity began to rebound after the pandemic period. Thanks to the consistent growth in both loans and deposits, a notable development for banks in Southeast Europe witnessed an increase in earnings and an expansion of assets. Like their counterparts around the world, local lenders kept playing a significant part in dispersing vast amounts of resources to lessen the effect of the Covid-19 outbreak on businesses and customers. The pressure on interest margins and shifting consumer behaviour have increased banks’ focus on efficiency and digitalization.

After a challenging year of limitations that negatively impacted their profitability, the top creditors in the area claimed increasing earnings in 2021. Except for 12, all of the top 100 banks in the area saw an increase in net profit in 2021.

The combined net profit of Southeast Europe’s top 100 banks totalled 4.567 billion euros in 2021, a significant decrease from the record-breaking 4.673 billion euros realized in 2019. Creditors could resume dividend distribution in 2021 thanks to higher revenues after deferring payments a year earlier to comply with central bank restrictions.

The biggest lenders in Southeast Europe were able to boost their asset growth in 2021 even more quickly than they had the year before, when lending surged due to government initiatives to assist the economy. After rising by 8,7% in 2020, the total assets of the top 100 creditors climbed by 12% to €384,3 billion in 2021.

Romanian banks took the top two spots, and with 19 participants, Romania remained the nation with the greatest representation in the 2021 list. It was followed by 15 and 14 banks each were Bulgaria and Serbia. The combined assets of Romanian banks totalled 125,9 billion euros or 33.1% of the combined assets of the major banks in the area. They produced 1,672 billion euros in net earnings or 37% of the total.

The largest bank in South-East Europe, Banca Transilvania of Romania, has maintained its position at the top of the list since 2018. As loans and deposits increased along with a robust rebound in the post-Covid economy, the bank’s assets increased by 21% over the course of the year to reach 25,4 billion euros. Its net income increased. The European Bank for Reconstruction and Development (EBRD) is next, with a 6,87% stake.

With assets of 18,1 billion euros, up 12% from the previous year, the Romanian Commercial Bank, a unit of the Austrian group Erste, swapped places with Croatia’s Zagreb Banka, a unit of the Italian group Unicredit, and rose to second place in the ranking. The Croatian creditor completed the year with 17,6 billion euros in assets, an increase of 6,36% from the previous year.

The top three lenders are also the highest earners. With a net profit of EUR 362,3 million, Banca Transilvania has triumphed over Banca Comercială Română, which came in second with EUR 280 million in net profit in 2021, and Croatian bank Zagreb Banka, which came in third with EUR 266,9 million.

Large mergers and acquisitions in the banking industry also occurred during the year. The Albanian division of the Greek company Alpha Bank, Alpha Bank SH.A., was acquired by the Hungarian OTP Group as part of its ongoing consolidation efforts in Albania. The French bank Societe Generale’s Albanian branch was purchased by OTP Group in 2019 and changed its name to Banka OTP Albania.

A deal was reached for the Belgian KBC financial group to acquire Raiffeisenbank Bulgaria, the Bulgarian branch of the Austrian Raiffeisen Bank International. The sale of Montenegro’s Universal Capital Bank (UCB) to an unnamed Italian investor was also agreed upon at the same time by Greek businessman Petros Stathis.

Do you want to know how these data and statistics will change by the end of the year? Stay tuned for more upcoming news from the economic, finance, and banking field to keep updated with local and international economic affairs and updates.