Research and Markets: Independent Forecasts and Competitive Intelligence on Romania's Commercial Banking Industry for Q4 2008
2009-01-14 10:37:03 -
Research and Markets (www.researchandmarkets.com/research/bbdeb1/romania_commercial) has announced the addition of the "Romania Commercial Banking Report Q4 2008" report to their offering.
This report is being written at a time when the global financial crisis - which arose as a result of the evaporation of inter-bank liquidity - appeared to be moving towards a resolution: the governments of the UK, the US and most of the larger countries in the euro area have all announced plans to make funds available - in one form or another - to their respective commercial banking sectors. As yet, it is too early to identify the impact of the crisis on particular emerging markets. However, in the regular section, which discusses the changes that we are making to the report, we include a lengthy essay which attempts to identify the key issues. In essence, in the emerging markets (and, indeed, the developed countries) of the Asia-Pacific, commercial banks appear to be well placed to deal with the crisis. The same is, broadly, true of commercial banks in the various countries of the Middle East and North Africa. In Latin America, Chile, Brazil, Mexico and Colombia appear better placed than Argentina, Venezuela, Bolivia and Ecuador. South Africa's situation appears to have much in common with that of Brazil: by contrast, Nigeria faces some of the same challenges as those that confront Venezuela. The positions of most countries in Central and Eastern Europe, however, are alarming.
It has not been practicable for us to collate the latest figures for bank assets and bank lending this quarter. The global financial situation has been changing so rapidly that most numbers would have become out of date. Nevertheless, we expect that, in coming months, it will become obvious that credit growth is slowing dramatically in most of the countries whose commercial banking sectors are profiled in BMI's reports. We will amend the figures - and indeed our forecasts - accordingly.
Nevertheless, we believe that the figures we compiled last quarter provide insights as to how the various commercial banking sectors will fare in the current, extremely uncertain, environment. We have therefore left them - and the comments on the Key Issues - essentially unchanged.
The figures on the tables above provide a snapshot of the banking sector in the Czech Republic and the changes that have taken place within it over the last year. To place the figures in context, it may be useful to bear in mind certain aspects of the 59 countries whose banking sectors are currently surveyed by BMI. Across this sample, the median growth in assets in local currency terms was 21.3% (in Colombia). The median loan growth was 21.6% (in India). The median growth in deposits was 17.9% (in Brazil). On their own, the ratios of loans to deposits, assets, and GDP mean little. However, they can provide useful hints when combined with other data. Across the 59 countries, the median loan/deposit ratio is 92.3% (in Greece). The median loan/asset ratio is 56.0% (in Poland). The median loan/GDP ratio was 63.9% in India.
From Q308, we have included a section that examines the risks associated with each country's banking sector in a new way. We have essentially sought to ask this question: to what extent will the banking sector likely need to source funding from banks in the rest of the world over the course of 2008? Given that the answer is not necessarily, on its own, meaningful, we have looked at other key issues such as the size and recent movement in the loan/deposit ratio, macro-economic developments and recent movements in financial markets.
In general, the first half of 2008 has been kind to fixed-income investors and money market participants in Central and Eastern Europe (CEE). Inter-bank lending rates have come down, thanks to the actions of the European Central Bank (ECB) and the Federal Reserve, among others. Benchmark bond yields have generally fallen in absolute terms and, in some cases, relative to yields in developed countries. This is in spite of the fact that, in many of the countries in the region, the statistics from the banking sector are worrying given the economic imbalances that persist.
As in previous reports, we include a SWOT analysis for the Czech Republic. We suggest that the two most important strengths of the Czech banking sector remain the macroeconomic stability in a country that has one of the highest per capita GDP's in Central and Eastern Europe, and the fact that the system is dominated by multinational banks who have exhibited discipline in lending. The main weakness is that the banking sector, which is not large in world terms, is maturing.
Since Q108, we have calculated, on a consistent basis, a Commercial Bank Business Environment Rating (CBBER) for each of the 59 countries surveyed. The CBBER includes an assessment of the limits of potential returns. It does this by taking into account the size, growth potential and bancassurance potential of the banking sector, as well as aspects of the economy in 2007. The CBBER also depends on an assessment of the risks to the realisation of potential returns. This reflects BMI's assessments of overall country risk, together with the regulatory and competitive environment.
Romania's overall CBBER is 61.0. Within the limits of potential returns, the banking structure and the country structure score 63.8 and 52.5 respectively. Within the risks to the realisation of potential returns, the banking elements and the country elements score 75.0 and 58.6, respectively.
Key Topics Covered:
- Executive Summary
- Key Issues
- Romania Commercial Banking SWOT
- Changes To The Commercial Banking Report
- Commercial Banking Business Environment Rating
- Anticipated Development
- Bank Lending
- Lending Overview
- Per-Capita Deposits
- Country Outlook
- Macroeconomic Trends And Developments
- Domestic Politics
- Industry Forecast Scenario
- Comment On Developments Over Last Year
- Comment On Forecasts
- Comment On Trends And Ratios
- Banks' Bond Portfolios
- Competitive Landscape And Protagonists
- Methodology
- Basis Of Projections
- Commercial Bank Business Environment Rating
For more information visit www.researchandmarkets.com/research/bbdeb1/romania_commercial
Research and Markets
Laura Wood
Senior Manager
press@researchandmarkets.com
Fax from USA: 646-607-1907
Fax from rest of the world: +353-1-481-1716
