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Fitch Ratings: Bank profits in Romania under pressure |
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Written by Broker Castellano
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Wednesday, 24 October 2007 |
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The rapid growth
of loans offered by Romanian banks is still continuing but their
profitability is influenced by the decrease of investments for
expansion, shows the Romanian Banks - Annual Review and Outlook set up
by the financial evaluation agency Fitch Ratings.
Banking Director at Fitch Ratings, Gulciun Orgun said that the economic
environment of the country has positively stimulated the credit market.
Orgun says that the achievements of the Romanian banking sector were
negatively affected by the decrease of interest rates in an economic
environment characterized by a strong competition, low inflation and
high costs associated to networks development.
However, the comfort level is still high due to the experienced foreign investors in the field.
According to
Fitch, the Romanian banking system is still highly concentrated - as
the first five institutions on the market control 59% of the total
market. The foreign owned banks dominate the local banking system,
totaling 89% of the actives.
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