BRD Results in Q1 2011: net banking income of RON 787 million and a net cost of risk lower by 10%

The main financial ratios of BRD-Groupe Société Générale as at March 31, 2011, according to the Romanian Accounting Standards:

• The net banking income amounts to RON 787 million, which is satisfactory in the current macroeconomic context
• The net cost of risk is RON 292 million, smaller by 10% compared to the Q1 2010, and by 40% compared to Q4 2010
• The net profit is RON 122 million

The financial results obtained by BRD - Groupe Société Générale in the first quarter of the current year reflect the still low economic activity and the stagnation of the demand for banking services. However in the course of the quarter some positive signs still timid at this stage appeared and have to be confirmed in Q2 2011:

• the improvement of the trade balance,
• the appreciation of RON
• some pick up in the demand for loans towards the end of the quarter

The net banking income reached RON 787 million, and the gross operating income amounted to RON 443 million, which we deem satisfactory in the current context.

The total volume of the loans to customers is of RON 32.4 billion, down by approximately 1% as against March 31, 2010. The loans to private clients amounted to RON 15.5 billion, down by approximately 1%, while the value of the loans to corporate clients decreased by 1%, the balance being of RON 16.8 billion. The total volume of client deposits was down by approximately 5% at the end of Q1 2011 compared to March 31, 2010, amounting to over RON 29 billion, nevertheless the liquidity situation of the Bank is, for the moment, quite confortable.

During the same period, the general expenses dropped by 1% against March 31, 2010, and the operating ratio, calculated as the ratio between the general expenses and the net banking income, reached 43.6%, due to the decrease of the net banking income. The net profit of the first quarter is of RON 122 million.

"The first three months of 2011 haven't brought the expected market recovery, and the difference compared to the last part of previous year was insignificant. The economic activity is still in distress, which also influences the demand for banking services. However, some positive signs have been noticed, which are to be confirmed in the following period, one of them being the beginning of a decrease in the net cost of risk, a trend which we hope will continue throughout the year", declared Guy Poupet, Chairman - CEO of BRD - Groupe Société Générale.

BRD - Groupe Société Générale is the second bank in Romania in terms of assets. The bank has got almost 2.5 million clients and operates a network of more than 930 agencies. BRD has the second capitalization of the Bucharest Stock Exchange.

BRD is part of the Société Générale Group, one of the largest groups of financial services in the Euro Zone. The group has over 160,000 employees worldwide, in three key businesses:

• Retail banking and financial services
• Global Investment Management & Services
• Corporate & Investment Banking