At the level of the banking system, 26 banks were in the red and reported for S1/2024 cumulative profits of 7.53 billion lei, and 6 banks were in the red, accumulating cumulative losses of 79.3 million lei. The entire banking system ended S1/2024 with a record profit of 7.5 billion lei, up by about 10% compared to S1/2023. Total private lending increased in S1/2024, but anemic, against the background of still high interest rates, the average growth rate being only 5.6%, below the speed of S1/2023. In the future, as the BNR will lower interest rates, after the two adjustments in July and August, the banks’ income from interest collected on loans and profits would also decrease.
The big banks were in the black in the first half (H1) of 2024, but the results were mixed, with some managing to achieve higher profits than in H1/2023, while other credit institutions posted lower earnings. These developments come in a context where lending and income growth continued, but at a slower pace, given that interest rates were still high in the first part of the year, and the cost of risks was low and provisions were reduced.
The interest collected by banks on loans is their main source of profit, and in the first half of this year interest in lei remained at high levels, although inflation dropped below 6%, and then towards 5%, the start of the decrease in interest rates being given by BNR in July and the adjustment continuing in August.
(source: AFP)
Source: jurnalul.ro
