Financiarul

Three weeks after the National Bank of Romania (BNR) gave a signal for a reduction of interest rates on deposits, by its decision to reduce the key interest rate by 0.5 percent on May 6, from 10 percent to 9.5 percent a year, banks adjusted their offer.

Since the beginning of June, over 14 banks on the market – both big and small – have cut their interests on deposits in lei, with cuts ranging from 0.25 to 3.15 percent. The market has now moved from standard interest rates of 13-14 percent to 10-11 percent.

Concerning large players, the most visible interest rate adjustments on standard term deposits denominated in lei have been operated by the BRD, the second-largest bank in terms of assets.

Interest rates offered by the bank have gone down by as much as 1.75 percent, to 11.75-12 percent.

BCR and Alpha Bank have, on the other hand, operated more moderate cuts, by 0.5 percent, to 11-12 percent a year.

Small players operating the biggest cuts are Libra Bank, Intesa Sanpaolo and ProCredit, with the biggest cut being operated for the 12-month term deposit in lei offered by Libra Bank, where the interest rate was reduced by 3.15 percent, to 12 percent.

“It is to be expected that the central bank will further cut the monetary policy interest rate, which means interest rates will continue to fall.

Now things are much more predictable, we are much surer that interest rates will go down,” daily Ziarul Financiar quotes Lucian Anghel, chief-economist of the BCR, the largest bank in the Romanian system as saying.

Nicolae Alexandru-Chidesciuc, senior economist at ING Bank, cited the the aforementioned daily said that the central bank has managed to maintain the interest rates on the inter-banking market (ROBOR indicator) to a level close the key interest rate, which means that it has just ensured liquidity on the market.

“After the agreement with the International Monetary Fund and the cut in the monetary policy interest by the BNR, it was expected the interest to deposits go down.

However, the interest rates of loans will fall only in August or September,” says Chidesciuc.

“At of the end of the third quarter, we;’ll face cuts in the interest rates of the loans in the entire banking system, and the cuts will be more visible at the end of the year, so that they will exceed the reductions of the deposits ‘ interests.

At the end of the year the interest of loans will go down more than those at deposits,” said Chidesciuc.
Lucian Anghel, however, said that the cut in loans’ interests will occur soon.