EC allows Romania to inject EUR 200 mln in CEC savings bank

The European Commission has allowed Romania to contribute EUR 200 million to the capital of the state-owned lender CEC Bank, as the operation is not breaching the state aid regulations.

The capital increase will allow CEC Bank to continue extending loans, since it has already reached the limits allowed by the current capitalisation and precautionary regulations, the central bank confirmed in October.

The European Commission has found that the capitalization will be carried out under market conditions and, therefore, does not involve any state aid to the bank as defined by the EU regulations.

“We found that the Romanian Government, as sole owner of CEC Bank, was going to make a capital injection in the bank under the same conditions that a private operator would accept in the market economy. Therefore, we concluded that the recapitalization of the bank did not involve state aid within the meaning of our norms," said the Commissioner responsible for competition policy, Margrethe Vestager.

In October 2019, Romania notified the Commission of its intention to capitalize CEC Bank, which is owned by the state. The capitalization aims to strengthen the bank's lending capacity, taking into account, in particular, the potential of the internal market and to initiate a substantial improvement of the bank's information system. Romania also submitted to the Commission the business plan of this bank for the period 2019-2023.

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