The state will inject 450 million RON (117 million euros) in the capital of CEC Bank in the first quarter of 2009, seeing the bank as playing a decisive role in lending money to the economy, while the management is looking at the financing of the rebranding process.

This is the first instalment of a 900 million RON (235 million euros) increase approved by the Government, with the rest of the money set to be transferred by the end of next year. As a result of the two increases, the capital of the bank will be more than double the current level.

"We need to make a series of investments in changing the image of the bank and in the IT system considering that we operate a significant network. These are extensive investments," commented Radu Ghetea, CEC Bank chairman, who did not specify the exact amount that is to be invested in 2009. The bank has a network of about 1,400 branches, the biggest of the system. Ghetea says the funds will be temporarily placed in T-bills or lending and be gradually used for the investment process.

CEC, the oldest bank in the system and held by the state, adopted a new strategy this summer to revamp its image and develop on the segments of local companies and low-income clients that are not targeted by the major competitor banks.

"CEC Bank, as a lender that traditionally gets its resources from the domestic financial market, and also as a bank whose sole shareholder is the state through the Ministry of Economy and Finance, can play a decisive role in ensuring continuity of the lending process, especially for small and medium-sized enterprises and for those areas less covered by the other major lenders," the substantiation note of the Government Ordinance published in the Official Gazette yesterday says.

The note also points out that commercial banks have changed their strategy due to the international financial cr