Bilansi uspjeha - Raiffeisen Bank

Macroeconomic Aggregates
Financial system still shows characteristics which indicate that it is based on banking, which is supported
by the data on financial strength of the banking system. Namely, total assets of the banking
sector at the end of year 2005 makes 85 of percentage points of gross domestic product. On the
other hand, along with the financial strengthening of the banking sector there was a growth of
trading oriented securities markets (SASE – Sarajevo Stock Exchange and BLSE – Banja Luka Stock
Exchange). So, securities on SASE was recorded in amount of EUR 283.77 mio, while at the same
time trading on BLSE was EUR 142.14 mio. In 2006, positive trend on stock exchange markets is
expected to be continued, and therefore SASE forecasts securities trading in amount of EUR 374
mio.
Consolidation of the banking sector is reflected in increase of concentration of leading bank groups,
entry of foreign financial institutions through acquisition of domestic banks, as well as increase in
efficiency and profitability of the banking operations are fundamental characteristics of BH banking
sector in the year 2005. During the year, Nova Ljubljanska Banka acquired two BH banks – Tuzlanska
Banka and Razvojna Banka Jugoistočne Evrope, while Italian Banca Intensa acquired minor
share in UPI Banka from Sarajevo, and already at the beginning of 2006, through the public offer,
it acquired 80% of ownership over this bank. This process led to strengthening of concentration,
measured by share of assets of 5 leading banking groups in total assets of the banking sector, and
at the end of 2005 this share was over 78%. At the same time, share of assets of banks in foreign
ownership in total assets of the banking sector reached the level of 90.7 percentage points.
During the observed period, assets of BH banking sector increased by a rate of 26 per cent, and
at the end of 2005 it realised value of BAM 11.77 billion. Contribution to continuous and significant
growing process of the banking sector, according to the unaudited data, resulted in growth of
total deposits in relative amount of 27 percent. On the other side, total loans increased under the
rate of 29 percent during the year. Finally, this led to decrease of coverage ratio of total loans by
total deposits at the level of 1.25, which is still significant in comparison to the developed banking
systems.
By observing the overall situation, efficiency and profitability of BH banking sector reached respectably
high level. At the end of 2005, consolidated profit after taxation was generated in amount of
BAM 96 mio, which represents increase of these aggregated variables in comparison to the previous
year in relative amount of 71 percentage points.
Process of development and growth of banking sector will cause continuation of consolidation processes
in the forthcoming year as well. Despite the fact that there was no decrease in number of
banks in this year, in the next period this process will be certainly intensified as a result of mutual
merger and acquisition of banks which are owned by the same legal entities. Also, development
of negotiations with EU will contribute to adoption of required institutional frames as a necessary
precondition in structural strengthening of banking sector and overall financial system in Bosnia
and Herzegovina.
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