The stock of bank loans to the non-government sector in Romania edged up marginally on the month by 0.2% to RON 221.9bn [EUR 50bn] at the end of August - yet lagging by 2.6% on the year, the central bank announced. The monthly advance in August was a result of the short-term exchange rate volatility but on a broader perspective the local currency has remained rather stable nominally and the annual contraction of non-government loans is pretty comparable when expressed in either local currency [2.6% y/y] or foreign currency [2.1% y/y].
The stock of non-government loans has contracted by EUR 1bn [2% ytd] in Jan-August this year after already narrowing by EUR 0.6bn in 2012. The downward pattern seen over the past two years follows another two-year credit expansion period in 2010-2011. Overall, the stock of non-government loans remains below the EUR 52.7bn peak reached at the end of October 2008, before the credit crunch.
Mortgage lending to households has increased significantly by 11.2% y/y to EUR 9bn at the end of August and accounts for 17.2% of the total bank loans [17.9% of non-government loans]. Mortgage lending, supported by the government guarantees programme, has partly offset the major 10% y/y decline in the stock of consumer loans that reached EUR 12.2bn at the end of August. Mortgage loans more than doubled from the EUR 5.2bn at end-Oct 2008. Consumer loans were nearly EUR 20bn before the credit crunch at end-Oct 2008. But even more concerning is the 2.5% y/y contraction in corporate lending. The interest rate cuts over the past months have pushed up the stock of local currency corporate loans by 2.4% y/y – but this slim improvement was insufficient to maintain the overall stock of loans to non-financial corporations on a positive annual trend.
|LOANS EUR bn||Household||Household:||Household:||Corporations:||Non-govt||Govt||TOTAL|
|% of total||44.6%||23.4%||17.2%||50.0%||95.8%||4.2%||100.0%|
A Romanian court ruled on July 18 that media tycoon and former politician Dan Voiculescu, who was sentenced to 10 years in prison in August 2014, should be released on parole after serving ... more
Evolution Equity Partners announced on 17 July the final closing of a new fund with total capital commitments of $125mn to make investments in cybersecurity and next generation enterprise software ... more
Romanian prime ministerial adviser Eugen Teodorovici was reportedly dismissed from the post on July 14, the day after he spoke about the possibility of taxing the local Orthodox Church. Teodorovici ... more