Romania Consumer Credit Law Complies With EU Directive - Watchdog

Constantin Cerbulescu, head of ANPC, said he had a "productive' discussion with officials of the International Monetary Fund regarding the consumer credit law, but stressed ANPC will not modify its stance on the existing loans.

The IMF is concerned about Romania's decision to apply the EU directive on consumer loans retroactively, because the measure could lead to "negative effects" for the eastern European country, IMF mission head, Jeffrey Franks, said earlier Tuesday.

Franks said the Romanian authorities agreed to consider implementing the norms only for new loans.

"We're optimistic we can find a solution," Franks said after a meeting with Cerbulescu.

The Romanian government approved in June an emergency ordinance regarding consumer loans, based on a document drafted by ANPC. The act transposes a European directive into the local legislation.

The ordinance eliminates early repayment fees for loans with variable interests and introduces a new calculation method for interests, based on a transparent reference index plus a fixed percentage, which cannot be modified throughout the duration of the contract.

ANPC extended the directive's stipulations to also cover existing loans, forcing the banks to amend approximately 8 million loan contracts.

End-September, the European Commission requested Romanian authorities send clarifications on the consumer loan ordinance, following a series of complaints about the EU directive being transposed retroactively.

According to Cerbulescu, ANPC and Romania's Department for External Affairs will sent a reply to Brussels this week.

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