The EBRD, set up to help the countries of Eastern Europe and the former Soviet Union in the transition from central planning to market economies, said operating profits before provisions fell to 1.54 million European currency units ($1.86 million) in the quarter to June 30 from 2.94 million ($3.55 million) in the first quarter.
Banks worldwide struggled to cope with sharp swings in world financial markets in the second quarter of the year and the EBRD was not immune from the problems.
The EBRD suffered a loss on financial operations of 5.59 million Ecu ($6.74 million), compared with a profit of 751,000 Ecu ($906,000) in the first.
The fall in trading profits followed a shift in investments from debt securities into shares, cash and money market instruments.
Chris Holyoak, a spokesman for the EBRD, said the trading losses were "a reflection of very adverse conditions in the markets."
This caused first-half 1994 profits before provisions to drop to 4.48 million Ecu from 10.35 million a year earlier.
Profits after provisions also took a blow. Holyoak said this was the result of increases in general provisions on loans and share investments.
EBRD accounting rules say each disbursement for a loan or a share purchase must be accompanied by a set sum of set-asides. "The more successful the bank is in getting disbursements out of the door, the higher the provisions," he said.
Loans and advances, for example, rose by nearly 100 million Ecu in the second quarter to 515.3 million ecu.
Higher lending boosted provisions for losses on loans and advances to 3.61 million Ecu from 2.59 million.
Similarly provisions for losses on share investments rose almost tenfold to 4 million Ecu in the second quarter from 416,000 Ecu in the first.
The increases left the EBRD with a loss after provisions of 6.06 million Ecu from April to June, after a 66,000 Ecu loss in from January to March.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.