Raiffeisen Bank Romania has reported a net profit of € 52.6m for 1H09, down 29% y/y. Lower staff costs (-8% y/y) and a limited increase of administrative expense (+1% y/y) helped offset weaker revenues and brought cost/income down to 55.3% in 1H09 versus 56% in the same period last year. The lower bottom line can thus be entirely attributed to a higher cost of risk. Balance sheet growth was limited to 2% y/y with loans down 14% y/y and deposits 7% y/y. Note that y/y changes also reflect a weaker RON exchange rate. Our view: In the context of very pessimistic consensus expectations for the performance of RIBH this year, we view the earnings development in Romania favourably and expect the news today to be supportive of the stock price.