High interest rates, gloomy outlook stifle bank lending in Romania
The stock of bank loans to the non-government sector in Romania increased by 5.5% y/y to RON 378.8bn (EUR 76.36bn) at the end of August, the National Bank of Romania announced.
After it reached 27.9% of GDP in August 2022, up from 26.3% in August 2019 before the Covid-19 crisis (supported by Government subsidies to corporate lending mainly), the financial intermediation in Romania plunged to 25.3% in August 2023, amid sluggish lending and high inflation.
The advance was mainly driven by the forex lending (+19.0% y/y to RON 120.5bn), while the stock of local currency loans edged up by only 0.2% y/y to RON 258.3bn (roughly two-thirds of the total).
By main types of customers and currency, the lending to households (predominantly in local currency) edged up insignificantly by 0.2% y/y to RON 172.3bn, the stock of loans to non-financial corporations advanced more significantly by 10.1% y/y (driven by the 28.3% y/y advance of the forex lending) to RON 189.4bn and the loans to financial non-bank corporations surged by 19.8% y/y to a still small amount of RON 17.1bn.
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