Bi-Weekly Report 14-27 August 2018

Turkey

Banking sector bottom line growth to turn negative for the first time in 4 years in FY:18, following a strong performance in H1:18

Romania

The NBR maintained its key rate at 2.5% in August

Credit expansion strengthened in Η1:18, despite the ongoing tightening in monetary policy

The deposit base continued to expand in H1:18, in line with economic activity

Bulgaria

Credit expansion strengthened modestly in H1:18, providing support to the economic recovery

Customer deposits maintained momentum in H1:18, in line with solid economic growth

Tourism activity remained strong in H1:18, sustaining economic growth and the current account surplus

Serbia

The profitability of the banking system improved markedly in FY:17, with ROAE reaching double digits for the first time on record, due to lower provisioning

FYROM

The Central Bank proceeded with an additional 25 bp cut to its key rate to a record low of 2.75%

Tourist arrivals rose sharply in H1:18, mainly due to supportive base effects

Albania

The banking sector's ROAE remained strong at 15% in H1:18

Cyprus                                                                                     

Tourist arrivals to reach a record high this year, despite increasing competition from neighbouring Turkey and Egypt

Customer deposits declined in June amid pressures on the customer base of Cyprus Cooperative Bank ahead of the House of Parliament's vote on its sale to Hellenic Bank

Credit deleveraging accelerated in H1:18, reflecting banks' increased efforts to reduce their NPLs

Egypt

The CBE is likely to keep key rates on hold until its November or December MPC meetings

The unemployment rate reached an 8-year low of 10.9% in FY:17/18

SDR-denominated Suez Canal receipts posted positive growth for the first time in 3 years, reaching a record high in 2017/18, on the back of a rebound in global trade

Appendix: Financial Markets