2011-06-17 Erste Financial Focus Weekly
Transcript of 2011-06-17 Erste Financial Focus Weekly
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Weekly Financial
Focus June 17, 2011
C/A balance contracted further (Jan-Apr-11)
Romania on the verge of administrative
reorganization
Leu loses ground amid jitters over Greece
Bond yields flat at the latest T-bonds auction
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News & real economy
C/A balance contracted further in the first four months
The C/A deficit continued to narrow in the first fourmonths of 2011 (-46% y/y), amounting to EUR 1.2bn.This trend was mainly driven by the much higher growthrate of exports compared to imports, which translateddirectly into a considerably lower trade deficit (-41% y/y)during January and April. Also, net current transferswere up almost 90% in the first four months, reachingEUR 1.1bn with the increased profile of the publicsector. However, feeble investments, as well as weakprivate consumption, prevented imports from growingfaster in the first four months, but this shows that gettingout of recession is not easy.
FDIs were down almost 30% to EUR 444 million in thefirst four months and as mentioned before this showsthat foreign capital is still in two minds whether or not toresume investment process in Romania. Although this
could delay somewhat the rebound of the gross fixed
Structure of the C/A and FDIs
-8
-7
-6
-5
-4
-3
-2
-1
0
1
2
4M_07 4M_08 4M_09 4M_10 4M_11
EUR bn. -7
-6
-5
-4
-3
-2
-1
0
1
2
3
4
EUR bn.
Current transfersIncomeTrade balance (G&S)FDIs (rhs)C/A balance (rhs)
Source: NBR and BCR Research
capital formation, we still see the economy advancing by 2% in 2011. The coverage rate of the C/A deficit was38.5% during January-April. Intra-group loans made up the bulk of the FDIs in the first four month amounting toEUR 324mn, while the balance was equity participations.
Romania on the verge of administrative reorganization
Ruling Democrat Liberal Party has put forward an administrative reorganization which should result in aconsiderably lower number of regions within Romania (8, as compared to 41 counties at present). DemocraticUnion of Hungarians in Romania, a key partner of the Democrat Liberals in the ruling coalition, rejected this projectand proposed instead an administrative reorganization with 16 regions.
A better absorption of European funds, a cut in current expenditures due to lay-offs and the elimination of someregional administrative entities as well as an increase in the quality of public services are the official reasons for the
reforms proposed by the Democrat Liberal Party. For the time being we see no significant risks for a breakup of theruling coalition and consider that the developments on the financial markets will be mainly driven by global factorslike the fiscal situation in Greece.
Leu weakens amid jitters over Greece
On Thursday, Greek worries began to weigh on leu which shed 1.5% against the European single currency, tradingat a four-month low of 4.245. Earlier this week, the NBR deputy governor said he did not see significant pressureon leu after the Greece downgrade, but the contagion risk remains a concern in the region. We see this statementas an indication of the NBRs willingness to step in the FX market if the situation gets worse. Taking into accountthe uncertainties surrounding Greece and the heightened risk aversion towards the region, we have revised ourEURRON forecast to 4.15 in December from a previous 4.1.
The MinFin sold 5-year T-bonds worth RON 330mn, at an average yield of 7.34%, unchanged as compared to theprevious auction. Investors submitted total bids worth RON 810mn, while the initial plans of the MinFin wereconsistent with an issuance of RON 600mn. The forecast for 5Y yields is unchanged, at 7.2% in December.
C o n t e n t s
News and real economy
FX, money market and FI
Capital market
Mutual funds
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FX MarketSpot Sep-11 Dec-11 Mar-12 Jun-12
EURRON - eop 4.229 4.15 4.15 4.10 4.00
- Fwd 4.28 4.33 4.38 4.42
USDRON - eop 2.986 3.19 3.19 3.28 3.20
- Fwd 3.03 3.08 3.13 3.17
Source: BCR Research, Reuters
EUR RON and 30-day rolling volatility
4.05
4.10
4.15
4.20
4.25
4.30
4.35
4.40
Jun-10
Jul-10
Aug-10
Sep-10
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
Mar-11
Apr-11
May-11
Jun-11
2
3
4
5
6
7
8
9
10EURRON
30-day rolling volatility (rhs)
12m average
Source: BCR Research, Reuters
Money market & FISpot Sep-11 Dec-11 Mar-12 Jun-12
Key rate 6.25 6.25 6.25 6.50 6.75
ROBOR 3M 5.48 6.10 6.30 6.50 6.75
- Fwd 6.41 6.70 7.17 6.30
5-year T-bonds 7.4 7.2 7.2 7.1 7.0
Source: BCR Research, Reuters
Yields - 5-year T-bonds
7.2
7.3
7.4
7.5
7.6
7.7
7.8
7.9
Sep-10
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
Mar-11
Apr-11
May-11
Jun-11
%
7.2
7.3
7.4
7.5
7.6
7.7
7.8
7.9%
12m average
Source: BCR Research, Reuters
Government gross debt issuance
RON mn. Jun-09 Jun-10 Jun-11 6m09 6m10 6m11
T-bills 6,556 674 1,200 38,114 14,913 21,520
T-bonds 1,141 284 830 2,532 5,857 6,807
TOTAL 7,697 958 2,030 40,645 20,770 28,327
Source: Ministry of Public Finances
5Y CDS
150
200
250
300
350
400
450
Jun-10
Jul-10
Aug-10
Sep-10
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
Mar-11
Apr-11
May-11
Jun-11
150
200
250
300
350
400
450
RO HU
Source: BCR Research, Reuters
Maturing government debt securities
RON million J-11 J-11 A-11 S-11 O-11 N-11 D-11 J-12 F-12 M-12 A-12 M-12
- T-bills 2,108 246 2,191 2,985 832 3,124 2,473 4,341 2,561 1,899 4,043 2,641
- T-bonds 0 0 0 0 3,153 0 0 0 0 2,114 50 0
TOTAL 2,108 246 2,191 2,985 3,985 3,124 2,473 4,341 2,561 4,013 4,093 2,641Source: Reuters
EUR million J-11 J-11 A-11 S-11 O-11 N-11 D-11 J-12 F-12 M-12 A-12 M-12
- T-bills (local) - 1,213 - - - - - - - - - -
- Club loan - 1,235 - - - - - - - - - -
- Eurobonds - - - - - - - - - - - 700
TOTAL - 2,448 - - - - - - - - - -Source: Reuters
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Auction schedule for government debt in June 2011
Debt instrumentAuction
dateIssuedate
MaturityCoupon
%
AmountplannedRON mn
Amountraised
RON mn
Yieldsavg.
%
T-bills 6-Jun-11 8-Jun-11 6-Jun-12 - 1,200 1,200 6.61
T-bonds 9-Jun-11 14-Jun-11 25-Oct-14 6.25 500 500 7.18
T-bonds 16-Jun-11 20-Jun-11 30-Apr-16 6.00 600 330 7.34
T-bills 20-Jun-11 22-Jun-11 20-Jun-12 - 1,400
T-bonds 23-Jun-11 27-Jun-11 11-Jun-21 5.95 600
Source: Ministry of Public Finances, Reuters
Capital marketFondul Proprietatea: City of London Investment Management owns 5.85% of shares
City of London Investment Management yesterday announced it holds 802.2mn Fondul Proprietatea (FP)shares representing 5.58% stake, out of which only 134mn shares were acquired directly on the BucharestStock Exchange (BSE). The rest of 668.2mn shares are held via warrants issued by Unicredit Bank whichaccording to market sources were acquired after FP floating on January 25, 2011.
The other important minority shareholder, with a 6.67% stake, is Georgia Palade Van Dusen, one of the heirsof the most famous Romanian industrialist from the interwar period. Ministry of Finance has 25.25% stake, thefree float being 62.23% (excluding the two holdings higher than 5%).
Industrial consumers to pay 30% higher gas price by March 2012
According to media the price of gas delivered to households will remain unchanged until March 2012, whileprices for some of the industrial consumers will grow by up to 30%. As a first step, the price will increase by10% in the next month. A gradually convergence of the domestic gas price to the import price (currently it ishalf of the Russian gas price) is strongly supportive for the profitability of gas producers Romgaz and Petrom.
The increasing pressure from the European Commission and IMF to speed up the liberalization of the gasand electricity markets is an important trigger for the profitability of energy producers from Fondul Proprietateaportfolio (Petrom, Romgaz, Hidroelectrica and Nuclearelectrica), wich, together with their listing, is the maindriver of FP valuation on the medium and long term.
Romanians President requires speeding-up IPOs of companies from FP portfolio
The Romanian president refused to promulgate the legislative initiative regarding the obligation for the state-owned companies from FPs portfolio to launch IPOs (for a minimum 5% stake) up to the end of 2014,requesting an earlier deadline.
The main companies from FP list that should launch IPOs are: Romgaz (already an IPO assumed for 1H2012), Hidroelectrica and Nuclearelectrica (last statements indicate IPOs for 15% stake earliest in 2013), CNAeroporturi Bucuresti, three power distribution grids, all port authorities, Posta Romana.
BET and BSE Turnover BSE and Rasdaq Turnover
0
100
200
300
400
Jun-10 Sep-10 Dec-10 Apr-11
Mn
1,000
3,000
5,000
7,000
9,000
11,000
Turnover (RON mn) BET (points)
8.20
13.02
9.64
14.04
0.28 0.12
2.130.71
0
2
4
6
8
10
12
14
16
10-Jun-11 14-J un-11 15-J un-11 16-J un-11
BVB Turnover (EUR mn) Rasdaq Turnover (EUR mn) Source: BCR Equity Research Source: BCR Equity Research
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Mutual fundsMoney continues to pour into emerging-markets bond funds such as BCR Obligatiuni. It is not surprising thatthe bulk of inflows are going into local-currency denominated funds; more than 80% of the $4 billion that hasflowed into emerging-market bond funds so far this year, and nearly two thirds of the $13.6 billion in the last
12 months, has gone into new local-currency offerings. Some of this interest could simply be performance-driven. Local-currency bonds, and by extension the funds that own them, offer a potential remedy to severalpressing concerns for institutional investors, including low bond yields and exposure to over indebtedgovernment issuers. Local-debt issues also tend to have better credit ratings than hard-currency emerging-markets bonds. This is a covenant of the success of some emerging governments in cleaning up theirbalance sheets since the previous decade as well as to their superior growth prospects.
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Annex
Macroeconomic indicators
1M_10 2M10 3M_10 4M10 6M_10 9M_10 12M_10 1M_11 2M_11 3M_11 4M_11
Industry y/y % ch. 6.9 2.7 4.1 5.2 5.6 5.2 5.5 11.9 12.2 11.4 9.4
- Manufacturing y/y % ch. 7.6 2.0 4.0 5.0 5.8 5.5 6.0 14.3 14.6 13.2 10.2
- Electricity, gas, steam
and air conditioning y/y % ch. 13.1 13.6 13.5 14.3 11.7 9.4 8.2 3.5 3.1 1.8 5.2
- Mining and quarrying y/y % ch. -14.0 -10.9 -12.4 -10.2 -9.2 -7.7 -6.9 1.6 2.1 3.8 5.9
- Capital goods y/y % ch. 23.2 13.9 11.9 11.9 11.2 9.0 8.9 13.9 14.3 14.1 8.6
- Durables y/y % ch. -11.9 -13.1 -9.4 -8.0 -5.9 -1.9 2.4 15.2 17.0 13.7 10.4
- Intermediery goods y/y % ch. 10.4 3.7 5.6 8.4 10.1 9.9 10.4 20.6 21.9 21.1 18.3
- Consumption goods y/y % ch. -15.0 -14.0 -8.2 -7.3 -6.1 -4.4 -3.5 7.9 6.3 2.6 2.8
New orders y/y % ch. 16.3 13.7 18.9 21.0 23.9 26.0 26.3 41.1 33.1 26.4 24.0
Constructions y/y % ch. -12.4 -19.5 -20.9 -19.9 -15.7 -16.4 -13.2 -8.5 -6.2 -4.4 -4.7- Residential y/y % ch. -42.4 -53.1 -41.0 -39.0 -34.0 -37.4 -35.7 0.3 0.6 -13.4 -20.8
- Non-residential y/y % ch. -28.4 -32.7 -30.1 -30.3 -22.4 -18.4 -13.6 -9.4 5.5 0.4 2.2
- Infrastructure y/y % ch. 16.3 13.5 -1.2 -0.3 -0.8 -4.7 -3.1 -10.7 -13 -3.3 -1.8
Retail sales y/y % ch. -11.4 -10.3 -7.5 -7.0 -4.1 -4.2 -5.3 -5.7 -6.0 -5.5 -5.2
- Food y/y % ch. -9.1 -9.2 -7.4 -7.7 -6.1 -7.0 -7.5 -7.4 -10.0 -10.7 -9.5
- Non-food y/y % ch. -13.5 -12.1 -8.9 -7.9 -4.9 -6.2 -7.9 0.5 -1.5 -1.3 -1.7
- Fuels y/y % ch. -10.7 -8.3 -4.7 -3.6 0.9 4.5 3.7 -15.4 -8.2 -5.1 -4.9
Auto vehicles sales and
related serv. y/y % ch. -29.4 -26.1 -17.8 -17.5 -11.9 -10.4 -6.6 10.7 10.3 4.8 3.5
Wholesale (nom. growth) y/y % ch. -16.2 -15.2 -7.0 -5.4 -3.7 -1.6 1.1 27.4 25.5 18.4 n/a
Household services y/y % ch. 7.0 8.4 8.4 9.8 11.8 12.5 12.0 7.3 8.4 7.4 7.5
Services to companies
(nom. growth) y/y % ch. -2.4 -3.3 -2.4 -1.3 2.1 2.1 3.1 5.0 5.2 4.6 n/a
Exports (FOB) y/y % ch. 20.5 21.9 20.0 23.5 26.2 26.6 28.1 47.9 42.2 39.4 33.3
mn. 2,313 4,876 7,902 10,798 17,164 26,855 37,253 3,421 6,933 11,013 14,392
- EU exports y/y % ch. 17.7 19.1 18.8 21.9 24.2 23.7 24.7 39.9 37.7 35.3 30.6
mn. 1,750 3,670 5,887 7,962 12,595 19,477 26,873 2,449 5,055 7,964 10,401
Imports (CIF) y/y % ch. 6.5 8.1 13.1 15.7 20.6 19.4 19.9 30.1 26.0 25.7 22.2
mn. 2,786 6,000 9,955 13,736 22,052 33,863 46,716 3,625 7,557 12,513 16,789
- EU imports (CIF) y/y % ch. 2.0 4.5 10.5 13.6 17.4 18.1 19.4 30.7 28.2 23.3 20.4
mn. 1,976 4,285 7,225 9,953 15,873 24,505 33,837 2,583 5,491 8,907 11,987
Trade deficit (FOB-FOB) mn. -258 -662 -1,287 -1,881 -3,024 -4,303 -5,905 91 -5.0 -455 -1,105
C/A deficit mn. -111 -747 -1,544 -2,149 -3,647 -4,233 -4,969 -15 -44 -634 -1,152
FDIs (inflows) mn. 302 140 486 623 1,838 2,070 2,596 240 294 379 444
CPI eop - % 5.20 4.49 4.20 4.28 4.38 7.77 7.96 6.99 7.60 8.01 8.34
- Core 2 (unadj.) eop - % 5.32 4.98 4.41 4.22 4.53 6.81 6.23 5.06 5.49 5.61 5.67
Gross wages RON 1,967 1,940 2,074 1,973 1,951 1,846 2,067 1,963 1,944 2,056 2,066
y/y % ch. 12m 8.0 6.8 6.0 5.3 4.7 2.8 2.5 1.9 1.6 0.8 1.1
Budget balance % of GDP 0.0 -1.1 -1.6 -2.4 -3.4 -4.6 -6.5 0.2 -0.4 -1.0 -0.8
RON mn. 15.4 -5,819 -8,422 -12,122 -18,070 -23,325 -33,305 819 -2,341 -5,190 -4,356
EUR/RON eop 4.12 4.11 4.10 4.13 4.37 4.27 4.28 4.25 4.22 4.11 4.07
avg 4.14 4.13 4.11 4.12 4.15 4.18 4.21 4.26 4.25 4.22 4.19
Key rate eop -% 7.50 7.00 6.50 6.50 6.25 6.25 6.25 6.25 6.25 6.25 6.25
ROBOR 3M eop -% 8.3 6.9 5.7 6.0 7.2 6.8 6.2 5.0 6.4 5.7 5.7
avg - % 8.8 8.0 7.4 6.8 6.8 6.8 6.7 5.3 5.7 6.1 5.7
Source: NIS, Central Bank, MoF, BCR Research
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Gross Domestic Product Households consumption
-5
-4
-3
-2
-1
0
1
2
3
4
5
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
%, q/q s.a
-10
-8
-6
-4
-2
0
2
4
6
8
10%, y/y n.s.a
-8
-6
-4
-2
0
2
4
6
8
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
%, q/q s.a
-18
-15-12
-9
-6-3
0
36
9
1215
18%, y/y n.s.a.
Source: Eurostat, BCR Research Source: Eurostat, BCR Research
Gross fixed capital formation Exports and imports of goods and services
-35
-30
-25
-20
-15
-10
-5
0
5
10
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
%, q/q s.a
-40
-30
-20
-10
0
10
20
30%, y/y n.s.a.
-15
-10
-5
0
5
10
15
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
%, q/q s.a
-30
-20
-10
0
10
20
30%, y/y n.s.a.
Exports Imports
Source: Eurostat, BCR Research Source: Eurostat, BCR Research
Industry Agriculture
-8
-6
-4
-2
0
2
4
6
8
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
%, q/q s.a
-12
-10-8
-6
-4-2
0
24
6
810
12%, y/y n.s.a.
-25
-20
-15
-10
-5
0
5
10
15
20
25
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
%, q/q s.a
-35-30-25-20-15-10-505101520253035%, y/y n.s.a.
Source: Eurostat, BCR Research Source: Eurostat, BCR Research
Construction Trade , financial intermediation, real estate
-10
-8
-6
-4
-2
0
2
4
6
8
10
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
%, q/q s.a
-20
-15
-10
-5
0
5
10
15
20
25
30
35%, y/y n.s.a.
-7-6-5-4-3-2-101234567
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
1Q_
08
2Q_
08
3Q_
08
4Q_
08
1Q_
09
2Q_
09
3Q_
09
4Q_
09
1Q_
10
2Q_
10
3Q_
10
4Q_
10
1Q_
11
%, q/q s.a
-15
-10
-5
0
5
10
15%, y/y n.s.a.
Wholesale & retail trade Financial intermediation; real estate
Source: Eurostat, BCR Research Source: Eurostat, BCR Research
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Industry %, real ch. 2005=100% (s.a.) Industry breakdown %, real ch. 2005=100% (s.a.)
110
115
120
125
130
135
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
110
115
120
125
130
135%
70
80
90
100
110
120
130
140
150
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
70
80
90
100
110
120
130
140
150%
ManufacturingElectricity, gas, steamMining
Source: Eurostat, BCR Research Source: Eurostat, BCR Research
Industry breakdown %, real ch. 2005=100% (s.a.) Industry breakdown %, real ch. 2005=100% (s.a.)
110
120
130
140
150
160
170
180
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
110
120
130
140
150
160
170
180%
Intermediate Capital
85
90
95
100
105
110115
120
125
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
85
90
95
100
105
110115
120
125%
Durables Cons um er
Source: Eurostat, BCR Research Source: Eurostat, BCR Research
New orders %, change 2005=100% (s.a.) IPPI - %, change 2005=100%
100
120
140
160
180
200
220
240
260280
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
100
120
140
160
180
200
220
240
260280%Domestic
External
120
125
130
135
140
145
150
155
160
165
170
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
120
125
130
135
140
145
150
155
160
165
170%
Domes tic External
Source: Eurostat, BCR Research Source: Eurostat, BCR Research
Construction %, real ch. 2005=100% (s.a.) Construction breakdown %, real ch. 2005=100% (s.a.)
130
140
150
160
170
180
190
200
210
220
Dec-07
Feb-08
Apr-
08
Jun-
08
Aug-
08
Oct-08
Dec-08
Feb-09
Apr-
09
Jun-
09
Aug-
09
Oct-09
Dec-09
Feb-10
Apr-
10
Jun-
10
Aug-
10
Oct-10
Dec-10
Feb-11
Apr-
11
%
130
140
150
160
170
180
190
200
210
220%
100
120
140
160
180
200
220
240
260
Dec-07
Feb-08
Apr
-08
Jun
-08
Aug
-08
Oct-08
Dec-08
Feb-09
Apr
-09
Jun
-09
Aug
-09
Oct-09
Dec-09
Feb-10
Apr
-10
Jun
-10
Aug
-10
Oct-10
Dec-10
Feb-11
Apr
-11
%
100
120
140
160
180
200
220
240
260%
Civil engineering
Buildings
Source: Eurostat, BCR Research Source: Eurostat, BCR Research
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Retail sales %, real ch. 2005=100% (s.a.) Retail sales breakdown %, real ch. 2005=100% (s.a.)
130
140
150
160
170
180
190
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
130
140
150
160
170
180
190%
120
130
140
150
160
170
180
190
200
210
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
120
130
140
150
160
170
180
190
200
210%
FoodFuelsNon-food
Source: Eurostat, BCR Research Source: Eurostat, BCR Research
Exports-Imports growth differential Exports 12-month rolling
-15
-10
-5
0
5
10
15
20
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
pp
-15
-10
-5
0
5
10
15
20pp
20
22
24
26
28
30
32
3436
38
40
42
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
EUR bn.
20
22
24
26
28
30
32
3436
38
40
42EUR bn.
Source: NIS, BCR Research Source: NIS, BCR Research
C/A balance, trade balance and FDIs 12m rolling Average gross wage development
-20
-16
-12
-8
-4
0
4
8
12
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
EUR bn.
-20
-16
-12
-8
-4
0
4
8
12
FDIs C/A balance
130
135
140
145
150
155
160
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
2005=100%
1,400
1,500
1,600
1,700
1,800
1,900
2,000RON
Gross wage (rhs)
% change, real
Source: Central Bank, BCR Research Note: 2005 average wage was RON 968 Source: NIS, BCR Research
Employment index %, real ch. 2005=100% (s.a.) Fiscal deficit 12m rolling (reversed scale)
60
70
80
90
100
110
120
130
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
60
70
80
90
100
110
120
130%
ConstructionRetail salesIndustry
-45
-40
-35
-30
-25
-20
-15
-10
-5
0
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
RON bn. -45
-40
-35
-30
-25
-20
-15
-10
-5
0
RON bn.
Source: Eurostat Source: MinFin, BCR Research
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Key rate, headline and core inflation Key rate and ROBOR monthly average
4
5
6
7
8
9
10
11
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
4
5
6
7
8
9
10
11%CPI
Key rate
CORE 2
4
6
8
10
12
14
16
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
%
4
6
8
10
12
14
16%
ROBOR 3m Key rate
* Not adjusted Source: NBR, BCR Research Source: NBR, BCR Research
REPO auctions Deposits auction
0
24
6
8
1012
14
16
10-Nov-08
27-Apr-09
25-May-09
12-Jun-09
09-Jul-09
27-Aug-09
05-Oct-09
12-Oct-09
25-Jan-10
24-Feb-10
02-Mar-11
31-May-11
RONb
illion
56789101112
1314%REPO
Interest rate, avg.(rhs)
0
1
2
3
4
5
6
7
8
9
28-Dec-07
16-Jan-08
22-Jan-08
30-Jan-08
20-Feb-08
10-Mar-08
31-Mar-08
16-Apr-08
23-Apr-08
16-Jun-08
21-Jul-08
29-Sep-08
19-Dec-08
23-Apr-10
20-Aug-10
17-Jan-11
RONbillion
5
6
7
8
9
10
11%DEPO
Interest rate, avg. (rhs)
Source: NBR, BCR Research Source: NBR, BCR Research
Inter-bank deposits (daily avg. transactions) FX turnover and EURRON average
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
RONb
n
-1
1
3
5
7
9
11
13
15%Interbank deposits
Interest rate avg. (rhs)
0.0
0.5
1.0
1.5
2.0
2.5
3.0
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
EUR bn
3.5
3.6
3.7
3.8
3.9
4.0
4.1
4.2
4.3
4.4
4.5FX turnoverEURRON - avg. (rhs)
Source: NBR, BCR Research Source: NBR, BCR Research
Gov. debt papers (RON denominated)* Gov. debt papers (EUR denominated)*
0
1
2
3
4
5
6
7
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
RON billion
5
6
7
8
9
10
11
12
13
14
15%Transactions (daily avg.)
Yields avg. (rhs)
0
5
10
15
20
25
30
35
40
45
Aug-
09
Sep-09
Oct-09
Nov-
09
Dec-09
Jan-
10
Feb-10
Mar-
10
Apr-
10
May-10
Jun-
10
Jul-
10
Aug-
10
Sep-10
Oct-10
Nov-
10
Dec-10
Jan-
11
Feb-11
Mar-
11
Apr-
11
May-11
E
URm
illion,dailyaveragetransaction
0
5
10
15
20
25
30
35
40
45
* Secondary market Source: NBR, BCR Research * Secondary market Source: NBR, BCR Research
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Auction schedule for government debt in October 2010
Debt instrumentAuction
dateIssuedate
MaturityCoupon
%
AmountplannedRON mn
Amountraised
RON mn
Yieldsavg.
%
T-bills 4-Oct-10 6-Oct-10 6-Apr-11 - 1,000 910 7.0
T-bonds 7-Oct-10 11-Oct-10 25-Jul-13 6.25 300 Scrapped
T-bills 11-Oct-10 13-Oct-10 12-Oct-11 - 1,000 371 7.0
T-bills 18-Oct-10 20-Oct-10 20-Apr-11 - 1,000 1,155 7.0
T-bonds 21-Oct-10 25-Oct-10 30-Apr-15 6.00 300 200 7.0
T-bills 25-Oct-10 27-Oct-10 26-Oct-11 - 1,000 461 7.0
Auction schedule for government debt in November 2010
Debt instrumentAuction
date
Issue
date
MaturityCoupon
%
Amountplanned
RON mn
Amountraised
RON mn
Yieldsavg.
%
T-bills 1-Nov-10 3-Nov-10 4-May-11 - 1,000 1,464 7.0
T-bonds 4-Nov-10 8-Nov-10 25-Jul-13 6.25 300 120 7.1
T-bills 8-Nov-10 10-Nov-10 9-Nov-11 - 1,000 1,000 7.3
T-bills 15-Nov-10 17-Nov-10 18-May-11 - 1,000 792 6.96
T-bonds 18-Nov-10 22-Nov-10 30-Apr-15 6.00 300 scrapped
T-bills 22-Nov-10 24-Nov-10 23-Nov-11 - 1,000 1,000 7.22
T-bonds 25-Nov-10 29-Nov-10 29-Nov-13 4.50 EUR 1bn. 1.3 4.8
Auction schedule for government debt in December 2010
Debt instrumentAuction
dateIssuedate
MaturityCoupon
%
AmountplannedRON mn
Amountraised
RON mn
Yieldsavg.
%
T-bills 6-Dec-10 8-Dec-10 8-Jun-11 - 1,000 1,000 6.88
T-bills 13-Dec-10 15-Dec-10 14-Dec-11 1,000 1,473 7.00
T-bonds 16-Dec-10 20-Dec-10 25-Jul-13 6.25 500 500 7.17
T-bills 20-Dec-10 22-Dec-10 22-Jun-11 800 1,776 6.71
T-bonds 23-Dec-10 27-Dec-10 30-Apr-15 6.00 300 534 7.27
T-bills 27-Dec-10 29-Dec-10 28-Dec-11 - 1,000 1,000 6.96
Auction schedule for government debt in January 2011
Debt instrumentAuction
dateIssuedate
MaturityCoupon
%
AmountplannedRON mn
Amountraised
RON mn
Yieldsavg.
%
T-bills 4-Jan-11 6-Jan-11 5-Jan-12 - 1,000 1,000 6.91
T-bonds 6-Jan-11 10-Jan-11 25-Jul-13 6.25 500 1,085 7.12
T-bills 10-Jan-11 12-Jan-11 11-Jan-12 - 800 800 6.81
T-bills 17-Jan-11 19-Jan-11 18-Jan-12 - 1,000 2,541 6.69
T-bonds 20-Jan-11 24-Jan-11 30-Apr-15 6.00 500 500 7.16
T-bills 24-Jan-11 26-Jan-11 26-Aug-11 - 1,000 1,000 6.28
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Auction schedule for government debt in February 2011
Debt instrumentAuction
dateIssuedate
MaturityCoupon
%
AmountplannedRON mn
Amountraised
RON mn
Yieldsavg.
%
T-bonds 3-Feb-11 7-Feb-11 25-Jul-13 6.25 800 775 7.11
T-bonds 3-Feb-11 7-Feb-11 30-Apr-15 6.00 500 500 7.16
T-bills 7-Feb-11 9-Feb-11 8-Feb-12 - 1,500 1,500 6.73
T-bills 14-Feb-11 16-Feb-11 17-Aug-11 - 600 600 6.55
T-bonds 17-Feb-11 21-Feb-11 11-Jun-17 6.75 500 284.1 7.35
T-bills 21-Feb-11 23-Feb-11 22-Feb-12 - 1,500 959 6.88
Auction schedule for government debt in March 2011
Debt instrumentAuction
dateIssuedate
MaturityCoupon
%
AmountplannedRON mn
Amountraised
RON mn
Yieldsavg.
%
T-bonds 3-Mar-11 7-Mar-11 25-Jul-13 6.25 600 Scrapped
T-bills 7-Mar-11 9-Mar-11 7-Mar-12 - 600 600 6.92
T-bills 14-Mar-11 16-Mar-11 14-Sep-11 - 1,000 1,000 6.85
T-bonds 17-Mar-11 21-Mar-11 30-Apr-15 6.00 400 317 7.35
T-bills 21-Mar-11 23-Mar-11 21-Mar-12 1,000 1,300 6.97
T-bonds 24-Mar-11 28-Mar-11 11-Jun-17 6.75 300 412 7.40
Auction schedule for government debt in April 2011
Debt instrumentAuction
dateIssuedate
MaturityCoupon
%
AmountplannedRON mn
Amountraised
RON mn
Yieldsavg.
%
T-bills 4-Apr-11 6-Apr-11 4-Apr-12 - 1,000 1,754 6.88
T-bonds 7-Apr-11 11-Apr-11 25-Oct-14 6.25 500 500 7.29
T-bills 11-Apr-11 13-Apr-11 11-Apr-12 - 1,000 2,289 6.84
T-bonds 14-Apr-11 18-Apr-11 30-Apr-16 6.00 500 289 7.38
T-bills 18-Apr-11 20-Apr-11 19-Sep-11 - 1,000 1,214 6.32
Auction schedule for government debt in May 2011
Debt instrumentAuction
dateIssuedate
MaturityCoupon
%
AmountplannedRON mn
Amountraised
RON mn
Yieldsavg.
%
T-bills 2-May-11 4-May-11 2-May-12 - 1,500 1,641 6.85
T-bonds (EUR denominated) 4-May-11 6-May-11 6-May-14 4.50 EUR 600mn EUR 939mn 4.89
T-bonds 5-May-11 9-May-11 25-Oct-14 6.25 500 206 7.31
T-bills 9-May-11 11-May-11 9-May-12 - 1,000 1,000 6.89
T-bills 16-May-11 18-May-11 16-Nov-11 - 800 1,124 6.29
T-bonds 19-May-11 23-May-11 30-Apr-16 6.00 500 500 7.34
T-bonds 26-May-11 30-May-11 11-Jun-21 5.95 500 500 7.45
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Fund key facts & performance updated as of June 15, 2011
Fund
Return at
36 months
(%)
Return at
12 months
(%)
Return
6 months
(%)
AUM
(mil. RON)
No.
Investors
MONEY MARKET FUNDS
RAIFFEISEN RON PLUS - 7.83 3.77 1,410.8 30,458
BCR MONETAR 34.62 7.60 3.64 1,497.1 65,652
OTP COMODISRO 29.90 7.58 3.50 135.2 2,456
SIMFONIA 1 29.56 6.76 3.28 407.9 14,721
BOND FUNDS
BCR OBLIGATIUNI 35.10 8.70 4.28 1,014.9 34,253
CERTINVEST OBLIGATIUNI 37.29 8.04 3.74 13.4 401
BT OBLIGATIUNI - 7.43 3.56 138.2 4,794
STABILO 21.79 6.16 2.76 18.4 989
BRD OBLIGATIUNI 14.67 6.15 2.97 17.1 487
DIVERSIFIED FUNDS (DEFENSIVE)
CARPATICA GLOBAL - 12.2 3.7 50.6 293
BT CLASIC 20.6 8.4 4.2 38.9 727
DIVERSIFIED FUNDS (BALANCED)
OTP BALANSISRO 8.6 17.4 12.4 2.9 88
BCR DINAMIC -0.3 15.0 10.0 33.8 2,547
INTEGRO -6.8 12.4 6.1 15.6 11,267
TRANSILVANIA -22.5 10.4 6.5 24.3 771
RAIFFEISEN BENEFIT 3.9 6.5 3.1 23.8 405
DIVERSIFIED FUNDS (DYNAMIC)
CARPATICA STOCK - 17.8 4.7 13.5 299
NAPOCA -63.1 13.6 9.7 11.3 1,334
CERTINVEST DINAMIC -36.0 13.3 7.4 10.6 1,527
DIVERSIFIED FUNDS (FLEXIBLE)
BRD ACTIUNI EUROPA - 14.4 7.0 15.4 131
BRD DIVERSO EUROPA - 13.7 5.9 24.0 257
ZEPTER ACTIUNI 0.3 3.0 0.8 8.9 16
EQUITY FUNDS
BCR EXPERT -25.8 24.4 15.4 14.8 849
KD MAXIMUS -8.0 19.9 4.9 40.8 794OTP AVANTISRO -34.4 16.5 11.1 10.2 252
BT INDEX ROTX -17.7 16.2 7.5 23.7 459
BT MAXIM -45.0 11.6 8.2 63.5 2,199
RAIFFEISEN ROMANIA ACTIUNI -56.5 9.4 7.0 17.1 510
RAIFFEISEN PROSPER -22.1 1.4 -4.4 35.2 1,099
ACTIVE DINAMIC -42.1 -4.9 -1.4 12.79 2015
ALTERNATIVE FUNDS
BCR EUROPA AVANSAT (RON) 11.8 12.2 5.9 9.9 8
RAIFFEISEN CONFORT (RON) 27.5 5.2 2.1 20.1 731
RAIFFEISEN CONFORT S2 (RON) - 4.1 0.2 34.8 740
BRD EUROFOND (EUR) - 7.1 2.8 68.5 1,464RAIFFEISEN EURO PLUS (EUR) - 4.0 2.0 225.5 8,725
Source: Erste Asset Management
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BCR Research - Weekly Financial Focus Page 14
Chief Economist Dr.Lucian Anghel +4 (021) 312 67 73/1020
Macro Research and Fixed Income
Dumitru Dulgheru +4 (021) 312 67 73/1025
Florin Eugen Sinca +4 (021) 312 67 73/1026
Dorina Cobscan +4 (021) 312 67 73/1028
Capital Market Research
Mihai Iulian Cruntu +4 (021) 311 27 54/4816Raluca Ungureanu +4 (021) 311 27 54/4842
Erste Asset Management
Eduard Inizian Institutional clients manager +40 372 269 920
This research report was prepared by Erste Group Bank AG (Erste Group) or its affiliate named herein. The individual(s) involved in the preparation of the reportwere at the relevant time employed in Erste Group or any of its affiliates. The report was prepared for Erste Group clients. The information herein has been obtainedfrom, and any opinions herein are based upon, sources believed reliable, but we do not represent that it is accurate or complete and it should not be relied upon assuch. All opinions, forecasts and estimates herein reflect our judgment on the date of this report and are subject to change without notice. The report is not intendedto be an offer, or the solicitation of any offer, to buy or sell the securities referred to herein. From time to time, Erste Group or its affiliates or the principals oremployees of Erste Group or its affiliates may have a position in the securities referred to herein or hold options, warrants or rights with respect thereto or othersecurities of such issuers and may make a market or otherwise act as principal in transactions in any of these securities. Erste Group or its affiliates or the principalsor employees of Erste Group or its affiliates may from time to time provide investment banking or consulting services to or serve as a director of a company beingreported on herein. Further information on the securities referred to herein may be obtained from Erste Group upon request. Past performance is not necessarilyindicative for future results and transactions in securities, options or futures can be considered risky. Not all transactions are suitable for every investor. Investorsshould consult their advisor, to make sure that the planned investment fits into their needs and preferences and that the involved risks are fully understood. Thisdocument may not be reproduced, distributed or published without the prior consent of Erste Group. Erste Group Bank AG confirms that it has approved anyinvestment advertisements contained in this material. Erste Group Bank AG is regulated by the Financial Market Authority (FMA) Otto-Wagner-Platz 5,1090 Vienna,and for the conduct of investment business in the UK by the Financial Services Authority (FSA).
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