Loan debtors up nearly 50 pc

Roughly 600,000 individuals fell behind on loan payments beyond 30 days late this month, up almost 200,000, or 47.7 per cent, from 2008. Ninety-day-plus arrears make up for 82.4 per cent of total late payments of RON 1.726 bln, National Bank of Romania informs.

The overall 90 days delays in loan payments late May amounted to RON 1.422 billion, up 10.1 per cent and 25.7 per cent from April and March respectively, and up nearly three-fold from May 2008. The number of loan borrowers who failed to pay their instalments for more than 30 days rose to 584,836, from 395,956 at the end of May 2008, and to 482,992 in January 2009. Also, loan debts were up from RON 733,357 in March to RON 806,086 in April and to RON 858,539 in May. Over the same interval, the number of loan debtors who owe loans of at least RON 20,000 increased 8.07 per cent from April, breaking the 200,000 threshold, or about 20 per cent of all the debtors, private individuals and companies.

The number of debtors in May came to 200,191 customers, physical and legal persons, almost double from the 100,676 debtors with arrears beyond one day in 2008, and up 44 per cent from the figure late last year, according to data provided by Banking Risks Central Office (CRB).

BNR credited banks with RON 352 M in June

By means of the Lombard permanent credit facility, the National Bank of Romania (BNR) lent in June RON 352 M worth of loans redeemable in a couple of days, the highest amount in the past three months, yet quite low compared to those lent in January, February and March. In May, the central bank did not credit banks via Lombard loans, and in April, loans totaled RON 139 M.

According to data supplied by the central bank, the sums drawn by banks through the Lombard permanent credit facility during the past three months are much lower than in January through March. In January, the loans came to RON 31.5 M, in February, RON 38.6 bln, the highest amount, and in March, RON 16 bln respectively. For the Lombard loans, BNR charged an interest of 13.5 per cent/year in June.

Also, BNR engaged in repo-type operations (temporary injection of liquidity against treasury bonds) averaging RON 748.8 M/day, up 16.24 per cent from RON 643.8 M in May. The average interest charged stood at 9.5 per cent/year, down from 9.71 per cent in May, and 10.03 per cent in April respectively. During the aforesaid interval, BNR did not carry out reverse repo operations (sales of bonds and drawing of liquidities).

Also, the banks made in June deposits equal to RON 4.17 bln, twice lower than in the preceding month when they totaled RON 10.38 bln.

BNR makes available very short term Lombard loans to banks at a rate on par with the monetary policy interest, plus four percentage points, and offers the possibility of placements at a rate equal to the key interest rate minus four percentage points.

In late June, the central bank cut the monetary policy rate by 0.5 per cent, to 9 per cent, the hard currency mandatory minimum reserve rate by 5 per cent, to 35 per cent of bank liabilities, and the RON mandatory minimum reserve rate by 3 per cent, to 15 per cent of bank liabilities.

BNR conducted yesterday a repo operation by means of which it lent banks RON 5.529 bln (EUR 1.3 bln) for one month, at an interest of 9 per cent/year, which matches the monetary policy rate. As part of the operation, the central banks gave out loans to 14 credit institutions due August 28. The latest two open-market operations made by BNR were of the reverse repo type, involving roughly RON 2.18 bln.

Nine o'clock