Raiffeisen Bank: Economy is late with repayment of loans

- The amount of problematic loans granted to domestic companies that are late with their repayment has reached 24%, which is a very high level - Oliver Roegl, the Chairman of the Managing Board of Raiffeisen Bank in Serbia, said today.

He said at the annual economic conference of Raiffeisen Bank in Belgrade that the fact that every fourth loan was problematic might significantly affect the operations and profitability of the banking sector in Serbia, but not the stability of banks since they had a high level of capital.

He said that the amount of problematic loans granted to the economy sector in the region ranged between 5 and 9%, that is, between 15 and 16% in Romania.

Roegl also said that total amount of problematic loans in the banking sector of Serbia amounted to 17.5%.

He pointed out that total level of problematic loans in the portfolio of Raiffeisen Bank in Serbia was 6.4%, while that level in the economy sector amounted to 6,5%, and added that he did not expect a significant change in that level.

He said that Raiffeisen Bank wanted to continue granting loans in Serbia and that that was the basic goal of the bank.

One of the bank's representatives said that Raiffeisen Bank intended to increase the share of Dinar loans in overall amount of loans, saying that that share had grown from 14 to about 25% in the first nine months of 2010.