Loading ...We might witness credit migration in the coming period, governor of the National Bank of Romania Mugur Isarescu cautioned on October 20.
“Interest rates will calm down, but it won’t be easy. We might witness credit migration in the coming period,” he said.
“Interest rates will calm down, but it won’t be easy. We might witness credit migration in the coming period,” he said.
Referring to the reasons why the banks claim that their loan disbursements are now less frequent, the BNR governor said: “The reason why banks do not grant credits is not that they would be hindered by the new BNR norms, but because of the market uncertainties. The messages on the market raised confusion. It’s hard to conceive a lending strategy under uncertainty.”
Mugur Isarescu advised the commercial banks not to speed up the lending process. “My advice is that the banks should not speed up the lending process because the distance from the gas to the brake pedal is short. My advice is not to speed because an abrupt break will follow. They will prove they are imprudent,” said Isarescu.
Referring to the evolution of credits, those in exotic currencies in particular, the BNR governor underscored that “the first to have hit the flat line is the Swiss franc denominated credit and forex loans will be next.”
Discouraging loans in the local leu is a fatal error for a banker. Under such circumstances I wonder when they were right, Isarescu commented on the bankers’ attitude.
As for the decline in retail lending from 110% to 50%, Mugur Isarescu said that “the weakening in lending growth is the most normal thing that can happen to Romania and it’s good that consumption lending sees a steeper decline.”
As for the decline in retail lending from 110% to 50%, Mugur Isarescu said that “the weakening in lending growth is the most normal thing that can happen to Romania and it’s good that consumption lending sees a steeper decline.”
Mugur Isarescu explained that the central bank injected on Friday 2 bln lei on the monetary market to boost liquidity. “Some banks had their need for liquidity covered, but others – especially foreign institutions – were unable to sort their problems out,” added Isarescu.
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