Romania's central bank cuts minimum reserve ratio for local banks

03 October 2016

Romania’s National Bank (BNR) Board of Directors decided on Friday to maintain the monetary policy interest rate for local currency RON at 1.75% per year.

However, BNR cut the minimum reserve requirements ratio on foreign exchange-denominated liabilities of credit institutions from 12% to 10% thus allowing local banks to free up some resources either to increase lending in foreign currency or to pay back to their parent-groups abroad.

The minimum reserve requirements ratio on RON-denominated liabilities remained unchanged at 8%.

The decision to reduce the reserve ratio on foreign currency liabilities came as a surprise considering that most analysts weren’t expecting any monetary policy relaxation. The BNR says its decisions aim to ensure and preserve price stability over the medium term in a manner conducive to achieving sustainable economic growth.

“The consolidation of the economic picture calls for a balanced macroeconomic policy mix and progress in structural reforms,” according to a BNR statement.

editor@romania-insider.com

Normal

Romania's central bank cuts minimum reserve ratio for local banks

03 October 2016

Romania’s National Bank (BNR) Board of Directors decided on Friday to maintain the monetary policy interest rate for local currency RON at 1.75% per year.

However, BNR cut the minimum reserve requirements ratio on foreign exchange-denominated liabilities of credit institutions from 12% to 10% thus allowing local banks to free up some resources either to increase lending in foreign currency or to pay back to their parent-groups abroad.

The minimum reserve requirements ratio on RON-denominated liabilities remained unchanged at 8%.

The decision to reduce the reserve ratio on foreign currency liabilities came as a surprise considering that most analysts weren’t expecting any monetary policy relaxation. The BNR says its decisions aim to ensure and preserve price stability over the medium term in a manner conducive to achieving sustainable economic growth.

“The consolidation of the economic picture calls for a balanced macroeconomic policy mix and progress in structural reforms,” according to a BNR statement.

editor@romania-insider.com

Normal
 

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