Annual Report 2010 - ProCredit Bank

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4 Annual Report 2010 Mission Statement ProCredit Bank Romania is a development-oriented full-service bank. We offer excellent customer service and a wide range of banking products. In our credit operations, we focus on lending to very small, small and medium-sized enterprises, as we are convinced that these businesses create the largest number of jobs and make a vital contribution to the economies in which they operate. Unlike other banks, our bank does not promote consumer loans. Instead we focus on responsible banking, by building a savings culture and long-term partnerships with our customers. Our shareholders expect a sustainable return on investment, but are not primarily interested in short-term profit maximisation. We invest extensively in the training of our staff in order to create an enjoyable and efficient working atmosphere, and to provide the friendliest and most competent service possible for our customers.
Letter from the Board of Administrators In 2010 Romania faced the difficult task of reconciling short-term fiscal consolidation with the need to mitigate the social costs of the economic crisis and restore the sources of sustainable and equitable growth. To this end, the government moved to contain the impact of the crisis and revive the structural reform agenda that had faltered since the country’s accession to the EU in 2007. The crisis also forced the state to implement fiscal adjustment measures and re-evaluate its policies, including its public sector wage expenditures. To achieve the 2010 target of keeping the fiscal deficit at or below 6.8% of GDP, the government passed a far-reaching austerity package that decreased public sector wages by 25%, increased VAT to 24%, and reduced social assistance programmes (including goods and services). It remains to be seen whether and to what extent the reforms – which have been supported by the IMF and EU – will indeed help to stabilise the internal economic situation and thus create a healthy basis for Romania’s future development. In the banking sector, the quality of the loan portfolio further deteriorated in 2010 for a multitude of reasons: the increasing unemployment rate, the stagnation of real wages and the lay-off of many public and private sector employees. In addition, lending activities remained weak this year and currency substitution continued (loans in Romania are denominated increasingly in EUR). However, some sectors reported growth – albeit moderate – in economic activity. Despite this progress, we expect the overall trend in lending to remain reserved throughout 2011. In line with its business strategy of being the house bank for small businesses, ProCredit Bank supported its clients throughout this difficult year. In 2010, it put significant effort into adjusting its institutional structures to better serve its core client groups of urban and rural small enterprises and private individuals. Among other measures, the acquisition process was reviewed and modified to enhance the efficiency of our client approach, and, in keeping with the ProCredit Group’s overall strategy of building stronger relationships with enterprise clients, in November 2010 the bank opened its first business centre in Bucharest. More of these specialised branches, which cater to the needs of small businesses, are scheduled to follow in 2011. In addition, the bank not only increased its loan portfolio, but during the last quarter of 2010 also maintained the portfolio’s relatively high quality despite the difficult economic environment. However, working with clients who were not able to service their loans in time continued to be a central issue for the institution throughout 2010, and management consequently made recovery and restructuring top priorities. In order to strengthen ProCredit Bank Romania’s capital base and to underscore their strong commitment to the institution, the bank’s shareholders increased its equity by EUR 5 million to EUR 32.6 million, bringing the capital adequacy ratio at year-end to a comfortable 16.6% (14.1% according to statutory reporting standards). 2010 was another year of great challenges and intensive learning for ProCredit Bank Romania. The ability of our staff and management team to cope with the quickly changing environment, to take sound decisions under difficult conditions, and to communicate openly and honestly with clients, business partners and the general public at all times made us an even stronger institution than we were before. Thus, on behalf of the entire Board, I would like to extend my sincere thanks to our very dedicated staff and management team. Anja Lepp Chairperson of the Board of Administrators Letter from the Board of Administrators 5 Members of the Board of Administrators as of December 31, 2010: Anja Lepp Hanns Martin Hagen Roger Bardo Rihmland Dietrich Ohse Ivaylo Iliev Blagoev Bank’s Managers as of December 31, 2010: Ilinca Rosetti (General Manager) Heribert Kailbach (Deputy General Manager)
Page 1 and 2: Annual Report 2010
Page 3: Contents 3 Mission Statement 4 Lett
Page 7 and 8: Commerzbank is Germany’s leading
Page 9 and 10: The Bank and its Shareholders 9
Page 11 and 12: entrepreneurs to better manage thei
Page 13 and 14: Political and Economic Environment
Page 15 and 16: maintain relationships with potenti
Page 17 and 18: Business Loan Portfolio - Breakdown
Page 19 and 20: Domestic Money Transfers Volume (in
Page 21 and 22: Management Business Review 21
Page 23 and 24: position to detect risks and take t
Page 25 and 26: sometimes engages in transactions w
Page 27 and 28: NRA process does management give it
Page 29 and 30: where they could make the greatest
Page 31 and 32: outside Romania at the internationa
Page 33 and 34: These six values represent the back
Page 35 and 36: The ProCredit Group: Responsible Ne
Page 37 and 38: The ProCredit Group: Responsible Ne
Page 39 and 40: Switzerland Germany Italy Czech Rep
Page 41 and 42: Name ProCredit Bank Albania ProCred
Page 43 and 44: Rodica and Ciprian Lazar, Producers
Page 45 and 46: Mr. Valeriu Dacius Masalar, 35, sta
Page 47 and 48: Financial Statements 47
Page 49 and 50: Statement of Financial Position As
Page 51 and 52: Statement of Cash Flows For the yea
Page 53 and 54: assets and liabilities denominated
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In assessing collective impairment
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Given the nature of the Bank’s op
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higher than EUR 30,000. These loans
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The following table shows the inter
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maintain a balance between continui
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Compliance with Bank standards is s
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6. Financial assets and liabilities
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Deferred taxes The deferred tax ass
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Operating leases Non-cancellable op
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26. Reserves In EUR 31 Dec 2010 31
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Financial Statements 75
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Baia Mare Branch 9 Unirii Blvd. Bai
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Contact Addresses 79
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Annual Report 2010 - ProCredit Bank

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