Agricover Credit IFN recorded a 49% increase in net profit in 2018 compared to the previous year
The value of loans granted in 2018 was 1.63 billion lei, while the number of active clients reached 2800 performing farmers, up 21% compared to the previous year.
"In 2018 we continued our healthy growth by developing our client portfolio in the micro, small and medium farmers segment. We have expanded our commercial team that goes directly to the farm to provide farmers with the most appropriate financing solutions and we have strengthened a dedicated team to address the specific financing needs of micro clients," said Robert Rekkers, CEO Agricover Credit IFN.
Financial information as of 31 December 2018:
Operating profit: 42,994,000 Lei, up 45% compared to 2017
Net profit: 33,225,000 Lei, up 49%
Shareholders' equity: 220,000,000 Lei, up 18%.
Capital adequacy ratio (according to NBR rules): 22.7%
Non-performing loans over 90 days past due: 1.26%
Value of loans granted: 1,628,000,000 Lei, up 19%.
Exposure from loans: 1,300,000,000 Lei, up 30%.
Number of active clients: 2800 farmers, up 21%.
Exposure from loans increased by 30%, reaching 1.30 billion lei. The rate of non-performing loans over 90 days past due was 1.26%, a very good level compared to the banking system average and down slightly from last year.
In order to secure the necessary funds for financing farmers, the company has maintained strong partnerships with local banks by extending existing credit lines, but also with established international partners such as International Finance Corporation, European Investment Bank, European Investment Fund, Black Sea Trade and Development Bank, European Fund for Southeast Europe, International Investment Bank, European Bank for Reconstruction and Development. The total amount of funds accessed in 2018 increased by 27% to 1.38 billion lei, while equity reached 220 million lei, up 18%.
In terms of the portfolio of specialized products, working capital financing continued to occupy the largest share of the volume of placements in 2018. "Medium-term loans aimed at the rapid acquisition of agricultural land recorded the highest growth, followed by financing solutions to cover input needs through synergy products developed within the Agricover Group. We understand agriculture, we know the specific needs of each individual farmer, which allows us to correctly assess risks, apply flexible collateralisation formulas and fast response times without bureaucracy. Because agriculture does not wait for delayed financing and the Romanian farmer needs support for growth and development," said Robert Rekkers.
"Pay-on-harvest diesel" is one of the synergy products that performed very well in 2018. Thus, a total of 1630 customers have accessed this solution offered through an unsecured loan dedicated exclusively to financing the purchase of diesel. The farmer is thus assured at all times of the diesel needed for agricultural production without worrying about payments until harvest.
Also, in 2018 the company paid special attention to the livestock sector, encouraging the development of beef cow farms and supporting the interest of farmers in the vegetable sector in diversifying their activity to add value to their business. Thus, in 2018 the company financed more than 50 farmers setting up beef cow farms, with a total amount financed of more than 12 million lei. "If we look at the overall picture of Romanian agriculture, it is obvious that the vegetable sector is predominant. However, Romania has excellent potential for livestock farming. There are optimal relief conditions for animal husbandry, and the beef cow can be a very good solution given the growing demand for quality products, both on the domestic and foreign markets", said Robert Rekkers, General Manager Agricover Credit IFN.
For 2019, Agricover Credit aims to continue its healthy growth, with a focus on expanding its portfolio of micro and small clients, as well as developing new specialised products aimed at these segments. At the same time, the company will continue to invest in the latest IT solutions to ensure prompt response and easy access to finance for a growing number of customers.
Agricover Credit IFN - a subsidiary of Agricover Holding is the first financial institution in Romania to offer financial products exclusively to farmers in the crop and livestock sectors. The knowledge and understanding of the specifics of the agricultural activity allow the development of innovative products for financing working capital and investments in a flexible way, adapted to the needs of farmers.
Agricover Credit has experienced rapid growth and in just a few years has become one of the key players in financing agricultural producers.
In 2017 the EBRD became a shareholder in Agricover Holding SA, with an investment of 32 million lei (equivalent to 7 million euro) in the company's capital to subscribe a stake of almost 13 percent.
Agricover Holding combines the activities of Agri-Business and Agri-Finance. With a strongly integrated business model, Agricover is a key link supporting the efficiency of the entire agribusiness value chain, providing specialized solutions for the development of the Romanian farmers' business.