FINANCIAL CRISIS AND BANK PROFITABILITY – THE CASE OF ROMANIA

Imola Driga

Annals of University of Craiova - Economic Sciences Series, 2013, vol. 1, issue 41, 34-45

Abstract: The purpose of this paper is to provide a global perspective on the determinants of bank profitability in Romania and to examine the effects of the financial crisis on bank profitability. In 2009, the banking system began to sense the effects of the crisis due to stagnation in lending, increased provisioning requirements and higher funding costs. Banks have tried to mitigate profit decrease by resizing networks expanded aggressively in recent years. Although the financial results of banks were still positive, the total profit recorded was more than 5 times lower than in the previous year. A major concern for banks has been how to manage anticipated and increasingly recorded credit losses on the market. These issues are explored more in depth in this study.

Keywords: financial crisis; Romanian banking system; bank profitability; return on assets; return on equity (search for similar items in EconPapers)
JEL-codes: G01 G21 G24 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:aio:aucsse:v:1:y:2013:i:41:p:34-45

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