BRD reports a net profit of RON 350 million for Q1 2025, +7% YoY

BRD reports a first strong quarter in terms of commercial activity with a „significant increase in corporates lending” (31.9% YoY), fueled especially by dynamic performance on SMEs (+36.7% YoY) and a „substantial expansion in loan origination for individuals”, reaching RON 3.3 billion, +41% YoY in Q1 2025, according to the press release.

“BRD marked a good start of the year. The first three months brought increasing commercial volumes on both corporate and retail segments, with net loans outstanding higher by +21% compared to end of March 2024. BRD remained closely connected to its customers, offering a wide range of financing solutions and savings options, designed to meet their evolving needs.

Lending on corporates led the growth, with +32% YoY increase, while lending on retail continued to pick up, marking +14% YoY increase in loans outstanding. Loan origination for individuals reached RON 3.3 bn, close to record levels, higher by 41% vs Q1 2024, driven by volume growth on both consumer and housing loans.

BRD remains dedicated to contribute to building a sustainable economy, providing financing to support the energy transition and the achievement of Romania’s sustainable goals with sustainable financing production reaching close to EUR 207m in Q1 2025.

In terms of financial performance, BRD delivered sustained revenue growth and positive jaws, benefiting from a maintained dynamic commercial momentum, and lower opex compared to revenues growth pace. Asset quality kept solid, while liquidity and capital levels continued to be robust, well positioning BRD for further growth.”, said Maria ROUSSEVA – CEO of BRD Groupe Société Générale.

Commercial momentum keeps high on all business segments
Net loans outstanding, including leasing financing, reached RON 51.6 billion, marking a +20.5% YoY increase compared to March 2024 end, sustained by vigorous lending activity across both corporate and private individuals’ segments.

Lending to corporates stood out as the main growth driver, with a yearly advance of +31.9% YoY, while the retail segment continued to gain traction, achieving a solid +13.6% YoY increase at March 2025 end.

The first three months of 2025 have been strong in loan origination for individuals, with production reaching RON 3.3 billion, up by +41% YoY vs Q1 2024, building on robust performance in both consumer and housing loans. Consumer loans production totaled RON 1.9 billion, up +31% YoY, whereas housing loans production maintained a very strong growth pace, up by +59% YoY, to RON 1.4 billion.

This strong performance was accompanied by the increase in the average financed value and also in the number of granted loans, including online loans (more than half of unsecured consumer loans were granted online vs one third in Q1 2024).

At end of March 2025, individuals’ loans outstanding increased by +13.4% YoY. Additionally, small businesses contributed to the positive trend, with net loans outstanding increasing by 17.3% YoY, following several improvements of the standard loans offering and the Bank’s commitment to participate in the government initiatives to support SMEs.

Leasing activity continued its solid growth trajectory, with net outstanding of leasing financing up by +15.1% YoY as of March 2025, above RON 2 bn.

Regarding customers savings, the deposit base increased by +5.2% YoY as of end of March 2025. Retail deposits, the stable and core source of funding, rose by +4.3% YoY, building on higher inflows in current accounts from private individuals. Deposits from corporates reached a YoY growth of +6.8%, underpinned by SMEs customers, with an increase of +14.5% YoY as of March 2025 in deposits outstanding.

BRD well delivers on profitability and efficiency
BRD Group net banking income advanced by +9.7 YoY during Q1 2025, driven by higher net interest income and net fees and commissions. Net interest income marked an advance of +5.9% YoY during Q1 2025, on positive volume effect, driven by growth of both retail and corporate loans. Interest expense decreased on an annual basis given the adjustment of funding costs to lower interest rates.

Net fees and commissions registered strong advance, up +29% YoY, given higher revenues from cards, custody, transfers and lending activities, including also an one-off income related to transaction fees, being tempered by the SRT related cost.

Other banking income remained quasi-flattish (-1.2% YoY) given offsetting components: higher revenues from foreign exchange counterbalanced by lower results from derivatives and other instruments held for trading on a base effect.

Operating expenses were up by +8.3 YoY in Q1 2025, reflecting persisting inflation context and high labor market competitiveness. Staff costs increased by 8% YoY, given higher salaries and other benefits adjustments. Other costs (excluding tax on turnover and cumulated contribution to deposit and guarantee fund) increased primarily linked to IT&C and consulting services.

For 2025, the cumulated contribution to Deposit Guarantee Fund and Resolution Fund increased to RON 49.6 million, from RON 43.1 million in Q1 2024. The 2% tax on turnover amounted to RON 32.4 million for Q1 2025 vs RON 30.4 million in Q1 2024, given higher revenues during the analysed period.

BRD Group gross operating income reached RON 507 million in Q1 2025 (+11.3% YoY) whereas cost to income ratio improved to 53.1% in Q1 2025 from 53.8% in Q1 2024. Excluding the tax on turnover and the cumulated contributions to deposit and guarantee fund, C/I would stand at 45.5% in Q1 2025 (vs. 46.3% in Q1 2024), -81 bps y/y.

The quality of the loan book quality remained solid during Q1 2025, with NPL ratio1 around record low level, reaching 2.2% at March 2025 end (below the banking system average, of 2.5% as of February 2025 end), while NPL coverage stands at a comfortable level (77.8% at March 2025 end).

Net cost of risk evolution confirms the normalization trend, with RON 79 million net provision allocation during Q1 2025 (vs RON 54 million in Q1 2024), linked to commercial advance on retail, while corporate continues to benefit from NPL recoveries.

BRD Group net result amounted to RON 350 million, +7.2% YoY, while ROE reached 14.5% in Q1 2025, same as for Q1 2024.

BRD standalone capital adequacy ratio is at comfortable level, at 23% as of March 2025 end, excluding the impact of the new regulatory temporary treatments (valid until 1st of January 2026).