Stock of Romanian bank deposits up 3.1% y/y to EUR 45.3bn at end-June

By bne IntelliNews July 23, 2013

The stock of deposits in Romanian banks increased by 3.1% y/y to EUR 45.3bn [RON 202.2bn] at the end of June, the central bank said.

The advance was driven by the 6.1% y/y expansion of household deposits – which accounted for 62.3% of total bank deposits to the non-government sector at end-June.

The stock of bank deposits has constantly increased since early 2009 – after an exchange rate correction incurred by the local currency gave a haircut in their value expressed in euro. The local currency’s strengthening meanwhile [vis-à-vis the euro] helped the deposits’ expansion meanwhile.

The loan-to-deposit ratio for the total banking system* edged down to 111% at the end of June from 114% at the end of 2012 and 119% at mid-2012. The ratio neared the 110% target level considered by foreign financial groups.

The households’ net balance with banks** improved by EUR 1.8bn to a positive value of EUR 4.9bn [3.7% of GDP] as of June compared to a year earlier. The households' net balance improved by EUR 6.4bn over the past four years ending June 2013 – meaning roughly during the recession period. Since October 2008, when the credit crunch started, the households’ net balance has improved by EUR 9.6bn [7.3% of last year’s GDP] from a negative value of minus 4.7bn. Out of the EUR 9.6bn made available to banks, only a small part was transferred to non-financial companies that increased their net borrowing position vis-a-vis banks by only EUR 2.3bn to a negative value of minus EUR 12.7bn.

* Calculated for the loans to and deposits of the non-government sector alone; the ratio for the government sector included was 98% at the end of June.

** deposits minus loans

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