Loading ...Romanian banks maintain a fast pace regarding crediting, yet large spending with the expansion of their networks puts pressure on their profitability, Fitch Ratings says in ‘Romanian Banks – Annual Review and Outlook’. The powerful economic growth, the easy access to credits and the higher revenues of the bank clients have stimulated loan growth, especially long-term loans in the retail industry, head of the agency’s banking unit Gulcin Orgun said.
The Fitch official noted bank assets remain at a low. The efficiency of the Romanian banking system was diminished by the reduction of margins due to low interest rates, on a stage dominated by low inflation and high competitiveness, Orgun said.
The fast increase in loans and the still high level of credits on the foreign currency market, which lacks in hedging instruments, could lead to problems concerning the quality of assets, as loans reach maturity and could increase operational risks, Fitch economists said.
The rating agency showed the increase seen in the assets of the banks in Romania is financed from abroad. Fitch said the Romanian banking system remains concentrated, with the first five banks controlling 59 percent of the total assets.
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