Romanian Ctrl Bk Should Amend Norms To Revive Lending – Bks Assoc

"BNR should change the norms as otherwise we are blocked. The norms were brought out in the summer of 2008, when the target was to slow down private lending. Nobody envisaged the current situation," Ghetea said after an economic seminar.

As for the "First Home" program, Ghetea appreciated the government initiative, but stressed upon the need of talks on a clear normative act and upon analyzing the way in which the current norms of the central bank are suiting such guarantee.

Romania Prime Minister Emil Boc said Wednesday that the loans contracted for the purchase of the first home will be guaranteed by the state, within the maximum limit of EUR60,000, with the entire financing granted to this program reaching EUR1 billion.

The guarantee will be available for people buying their first home and who have not taken any mortgage loans before.

The selection criteria of Romanian banks that will further take part in the government’s program meant to guarantee loans contracted for the purchase of the first house will include charge-free early loan repayment, a required downpayment of maximum 5% of the loan value, and dwelling’s evaluation procedures, Premier Emil Boc said.

According to Ghetea, the guarantees granted by the Romanian Credit Guarantee Fund For Small and Medium Sized Enterprises SMEs are a collateral, according to BNR norms, for only 60% of the loan’s value.

Ghetea also said the banks could meet the Government’s condition of a 5% downpayment of the loan, as long as the client has high revenues, a good financial standing and a stable job.

Tuesday, ARB management will meet the Finance Minister Gheorghe Pogea and BNR representatives to talk on the "First House" program.

The Credit Guarantee Fund For SMEs will take a EUR100 million loan, with state guarantee for 80% of the amount, and its business line will be expanded to include guaranteeing mortgage loans.