Romanian Bankers Ask Ctrl Bk To Change Some Rules

ARB proposed the central bank recently to encourage the rescheduling of payments and loan restructuring for clients that have trouble paying their debts, procedures that several banks have already started to implement.

Part of the loans’ guarantees to be considered when the client exceeds the payment deadline by more than 90 days and the banks are forced to create write-downs is another measure proposed by ARB. Banks currently consider the entire loan for write-downs.

Ghetea added a solution needs to be found to delay foreclosure procedures to 120-150 days after the last payment, compared with 90 days in the current regulation.

ARB also requested the central bank to consider state treasuries as an alternative when banks face a liquidity crisis.

"Given the current conditions, (…) state treasuries should be seen as a proper guarantee when a liquidity crisis occurs,” Ghetea said.

The bankers also asked for a change in the way treasuries and swap operations are evaluated at the end of each year.

As financing lines from local banks are less active at this time and loans from financing institutions as the International Monetary Fund or the European Bank for Reconstruction and Development are debated, ARB said it would be better to return to an older rule by which credit lines from international financing institutions should not be considered in the calculation of minimum reserve rates.

“By that, banks could access the funds they need,” Ghetea said.

Last week, the National Bank of Romania decided to cut the key rate by 0.25 percentage points to 10%, but kept unchanged the minimum required reserves ratios on both leu-denominated and foreign currencies liabilities at 18% and 40%, respectively.