The geopolitical tensions do not affect Banca Transilavania’s operations, considering that we are not present on the neighbouring market and that the Romanian banking system is not directly exposed to risks associated with the conflict in Ukraine. Of course, there is an impact when it comes to payables and receivables with the Russian Federation, as we must respect EU regulations pertaining to international sanctions but we try to responsibly manage the situation in such a way so that the effect on our customers is minimal. As for risk costs, they will increase, but not necessarily as a direct result of the situation in Ukraine, as there are cumulative recession signals coming from the U.S. and the Euro zone. In line with the requirements of the European Central Bank, credit risk management is a priority for us, together with the governance and the solidity of our business model.
Adapting to the newly created conditions that influenced the implementation of some of its plans and ideas, Halkbank AD Skopje managed to achieve the goals set at the beginning of 2021 and showed excellent business results from operations.
In 2021, Halkbank AD Skopje reported credit growth of 12% and 10% increase of the deposit base. The credit support that the Bank provides to businesses in the country is reflected in the 18% increase in loans to legal entities, i.e. loans to small businesses. When it comes to loan products for households, the Bank registered an increase in housing loans of 25% compared to 2020. On the basis of the stated results, Halkbank booked 10.6 million euro profit in 2021, an annual increase of 18%. Its assets amounted to 1.182 million euro at the end of the year, which is an increase of 9% compared to 2020.
As social life returned to normalcy and economic activity picked up, banks in Southeast Europe saw their profits rise and their assets expand on the back of sustained growth in both lending and deposits. Like their global peers, the local lenders continued to play a major role in the redistribution of massive resources aimed to cushion the blow of the Covid-19 pandemic on businesses and clients. At the same time, pressure on interest margins and changing consumer habits strengthened the banks’ focus on efficiency and digitalisation. M&A deals picked up, with most of the action taking place in Serbia.