Annual Report 2008 - ProCredit Bank

Management Business Review 21
banks and microcredit organisations that had
lent liberally over the years. Although ProCredit
Bank has always maintained a conservative and
prudent approach when approving loans, the fact
that many of our borrowers also had loans outstanding
at other institutions adversely affected
their repayment capacity, and thus impacted our
portfolio at risk (the proportion of total loans in arrears
by over 30 days). The PAR rose from 1.6% at
the end of 2007 to 2.3% at year-end. Additional
causes for this increase could be seen in external
shocks, such as accelerating inflation, which created
liquidity constraints for small businesses.
As of December 31, the portfolio comprised
65,277 outstanding loans totalling BAM 318.6
million (EUR 162.9 million). The bank disbursed
42,000 loans during the year with a combined
volume of BAM 273.0 million (EUR 139.6 million).
An average loan disbursement of BAM 6,505 (EUR
3,326) reflects our continuing focus on our designated
target groups.
Loans outstanding to agricultural producers and
sole proprietors amounted to BAM 163.4 million
(EUR 83.5 million) at year-end, representing 51.3%
of the bank’s total portfolio. Loans to small and medium
enterprises stood at BAM 107.7 million (EUR
55.0 million), representing an increase of 10.8%
over 2007. In the coming year, the bank will focus
on boosting its market share in this segment, introducing
new products and services that are tailored
to the requirements of the SME target group.
Our portfolio of bank guarantees and letters of
credit increased by 22.5% to BAM 9.3 million
(EUR 4.8 million). In line with our mission to support
the development of as many small businesses
as possible, we will seek to further increase
our market share of these non-lending products
in the coming year.
Deposits and Other Banking Services
Despite turbulence in the BiH economy, ProCredit
Bank significantly expanded its deposit base during
2008. At year-end, the bank had over 145,000
account holders with 113,096 active accounts.
Total deposits were up by 20%, compared to a
total decrease of 1% for the banking sector as a
whole. At BAM 335.6 million (EUR 171.6 million),
this amount was equivalent to 72.3% of total assets
and 105.0% of the bank’s loan portfolio.
The average individual deposit amount was BAM
2,406 (EUR 1,230), while the average balance per
customer stood at BAM 2,347 (EUR 1,200).
Given the general loss of public confidence in
the banking sector, we consider the growth we
achieved in our deposit business to be a positive
reflection of our solid reputation amongst savers.
It also demonstrates the success of our efforts
to promote a savings culture in BiH and the effectiveness
of our commitment to providing simple,
transparent savings products and high-quality
service.
Domestic Money Transfers
International Money Transfers
Volume (in EUR million)
750
675
600
525
450
375
300
225
150
75
0
Jan–
Jun
04
Jul–
Dec
Jan–
Jun
05
Jul–
Dec
Jan–
Jun
06
Jul–
Dec
Jan–
Jun
07
Incoming Outgoing Number
Jul–
Dec
Number (in ’000)
Jan–
Jun
08
Jul–
Dec
1,000
900
800
700
600
500
400
300
200
100
0
Volume (in EUR million)
200
180
160
140
120
100
80
60
40
20
0
Jan–
Jun
04
Jul–
Dec
Jan–
Jun
05
Jul–
Dec
Jan–
Jun
06
Jul–
Dec
Jan–
Jun
07
Incoming Outgoing Number
Jul–
Dec
Number (in ’000)
Jan–
Jun
08
Jul–
Dec
30
27
24
21
18
15
12
9
6
3
0