National Bank Governor was heard by Senate over suspicions the central bank has interfered with the calculation of ROBOR.
Members of the National Bank board, including Governor Mugur
Isarescu, were heard by the joint Senate committees for budget-finances and the
economy. The talks took place against the background of recent criticism
concerning the central bank policies. Senator Daniel Zamfir, chair of the
economic committee and a member of the Alliance of Liberals and Democrats (ALDE),
a junior partner in the ruling coalition, was particularly vocal in accusing
the National Bank of interfering with the calculation of ROBOR.
Governor Isarescu denied any manipulation of interest rates and of
the exchange rate for the national currency, and assured the committee that the
ROBOR index does not deviate from the actual market level. He gave details on
inter-bank transactions, explaining that some banks have cash surpluses,
whereas others have deficits. Mugur Isarescu also said that at present the
ROBOR level can only fluctuate within the 1.5 to 3.5% range, which is the only
way the National Bank can attract deposits from and give loans to commercial
banks by means of state bonds. Mugur Isarescu:
"This is exclusively the inter-banking market that we are talking
about. This is where banks compete with each other, and in this market banks
may use interest rates that vary within certain limits, but variations go down
to one-hundredth of a point. So I can guarantee you that there is no
manipulation, no deviation of ROBOR from the real market value. The market
works very well. And proof that it does is the stability of the exchange rate
and of the interest rates."
The central bank chief also explained that the ROBOR index stayed at
a lower level as long as the inflation rate was low, and that the National Bank
does not "play with the monetary policy." Instead, it is a case of interest
rates going up at the same speed as inflation. Asked whether there is any way
to calculate ROBOR so that its variation would be smaller, the National Bank
official said that a task force made up of representatives of the Finance
Ministry and of the central bank is looking for such options. But, he added, a
more favourable solution than the current one is hard to find.
During the talks, Senator Daniel Zamfir also discussed the business
model of banks in Romania. In his opinion, Romania is the poorest EU member
country at present, and the National Bank Governor should have worked together
with Parliament, banks and the Government to come up with solutions for the
development of the country. Daniel Zamfir:
"The Romanian banking sector has the lowest financial intermediation
level in the EU, more precisely four times lower. Meanwhile, banks' profits are
double the European average."
National Bank officials explained that low banking intermediation is
a serious problem, but one which can only be solved by means of structural