Developments on the banking market
Loans in the national currency are going to become cheaper in the wake of the ROBOR index going down to a historical low.
România Internațional, 09.02.2016, 13:32
The ROBOR index, the Romanian inter-bank offer rate for three months, continues its downward trend, which started in 2015. Earlier this week, the index went down to a historical low of 0.79%, almost half as compared to last year. Its evolution is important to people with loans in the national currency, since the interest rate of those loans is a sum total of the ROBOR index and the banks margin. It is equally important to those who want to get a loan. Adrian Vasilescu, strategy advisor to the Governor of the National Bank of Romania, recalls that the positive impact on the costs concerning the loans in Lei were visible last year, warning against the danger of savings being forestalled:
“This is a sensitive and important problem. While becoming cheaper, loans might entail the decrease of the interest rate of deposits. I do believe that banks will be able not to excessively lower the interest rate for deposits and thus forestall savings.
People who want to buy a house by contracting a loan are carefully monitoring the developments on the banking market, all the more so as the state-subsidized ‘first home owners lending scheme is jeopardized by another bill. Conceived as aid for Romanians who can no longer pay their mortgage loan, the Repossession Law stipulates that a borrower can at any time turn over his house to the bank to cover his debts without being monitored by the lender any more. However, banks representatives say that the enforcement of the Repossession Law might impose more restrictive conditions for giving out loans. Public Relations director of the Council of Banking Employers in Romania, Bogdan Preda, explains:
“We have made it very clear that bill must address people who simply can no longer afford to pay their loans, not those who refuse to pay them. If the amended version of this law is passed, we will have to see if people who trade in their properties to discharge their debts are in fact people who own several properties, in an attempt to cut their losses, or simply people who own a single property and who clearly cannot meet the deadline for their mortgage loans.
If passed, the Repossession Law, currently submitted to the Senate, after president Klaus Iohannis forwarded the bill back to Parliament last December, will be enforced on natural persons who can no longer pay their debts. Real estate developers are not subject to its provisions.
(Translated by V. Palcu)
