Banco de la República Oriental del Uruguay (BROU), the country’s biggest bank, has room to make considerable improvement, although it has partially recovered from a massive run on deposits in 2002. With profits on average capital of 9.2% and a return on assets of 0.55%, according to The Banker, analysts doubt the management’s stated goal of raising profitability to a 12% return on capital and 1.2% over assets is possible while it continues to be state-owned and there is insufficient demand for credit in the country.
On May 31, deposits amounted to the equivalent of $4.71bn, compared with $3.31bn on May 31, 2002. In the first half of 2006 it made a profit of $39m, more than its stated net profit of $34m for the whole of 2005. Its profits have been steadily rising from the $188m loss of 2002.
