Retail lending in Romania silenced by inflation, interest rates

The stock of retail loans in Romania has decreased in nominal terms since September, and the stock of corporate loans was marginally pushed up only by bullet loans visible in September and December.

Overall, the stock of bank loans to non-government decreased by 0.2% from September to January, to RON 364.1 bn (EUR 74 bln, 25.5% of GDP).

The bank loans to GDP ratio was 27.6% at the end of January 2022.

The annual advance of the total stock of loans eased to 11.5% YoY at the end of January, down from 16.0% YoY in September.

The deceleration was more visible for the stock of retail loans, which shrank by 1.3% from September to January, while the annual advance eased to 3.7% YoY (to EUR 170.1 bln) in January from 6.5% YoY in September.

The growth rates should be regarded in the context of rampant inflation of 15% YoY or more since July. The corporate lending would have perhaps followed the same downward pattern, but several bullet loans were visible in September, December, and most likely in January, resulting in a still relevant 19.1% YoY advance of the stock of corporate loans to RON 178.0 bln.

(Photo: Kittichai Boonpong/ Dreamstime)