Greece and Austria trim financing lines to Romanian banks by EUR 2.3bn, central lender says

Publish date: 15-05-2009
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Financing lines from mother banks in Greece and Austria to Romanian lenders were cut back by 2.293 billion euros in the period September 2008 - March 2009, while the equity of the respective Romanian subsidiaries dropped by 472 million euros, central lender (BNR) data show.

The financing line balance from Greek mother lenders towards their Romanian subsidiaries was reduced by 1.641 billion euros in the period, while financing from Austrian banks to the local units was trimmed by 652 million euros, according to a presentation of BNR vice governor Eugen Dijmarescu.

Meanwhile, French lenders hiked their financing lines to Romania by 722 million euros and Italy increased them by 134 million euros in the same period.

The external credit balance from lenders in Hungary upped 26 million euros and the financing lines from mother banks in the Netherlands grew by 36 million euros.

The ownership equity of lenders in Romania with Austrian capital was slashed by 373 million euros, while the equity of Greek banks present in Romania dropped by 99 million euros between September 2008 - March 2009.

The subsidiaries of Italian lenders saw their ownership equity down 31 million euros, while the units of banks in Hungary witnessed a 30 million euro cut.

On the other hand, ownership equity of lenders in Romania with French capital climbed 18 million euros and those of lenders with Dutch capital rose by 76 million euros.

The data on ownership equity take into account the effects of the deterioration of banking portfolios, which led to an increase in provisions, and are adjusted on the exchange rate. 

"Moreover, the deterioration of macroeconomic conditions in the countries of origin will affect the mother lenders' solvency, with effects on the possibility to ensure financing to their units. The credit risk could exceed the liquidity risk," the presentation reads.


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