Government To Permit Derogation From Purchase Restrictions Imposed On State Companies

05.22.2011 By Ioana Tudor

The Romanian Government will permit derogation from norms forbidding state-owned companies to buy cars, furniture and office equipment, to let state-run lender CEC Bank modernize its subsidiaries.

The Government decided to restrict the purchase of cars and furniture by autonomous administrations and state companies, as well as public institutions, and reserved the right to approve such purchase through memoranda.

According to a document obtained by MEDIAFAX, state-owned lenders and insurers will be allowed to modernize their headquarters to keep up with their competitors.

People familiar with the matter told MEDIAFAX CEC Bank will get derogation from the norm to upgrade all its subsidiaries.

CEC Bank recently increased its share capital by 52.6 million lei (EUR12.7 million) to RON1.047 billion, mainly by incorporating the previous year's profit.

The lender reported a 30.16% increase in its pretax profit to RON65.13 in 2010, on higher banking revenue.

Its pretax operating income, excluding provisions, stood at RON430.17 million at the end of 2010, up 11.4% on the year.

CEC reported total assets of RON21.7 billion in 2010, up 4.2% on the year.

The bank operates over 1,200 branches nationwide. (EUR1=RON4.1091)