RO banks' exposure to real estate sector twice as large as that to industry

Romanian banks' exposures to the real estate market have reached high levels, exceeding RON 170 bln (some EUR 35 bln), of which more than RON 100 bln are on the residential real estate segment, according to data from the National Bank of Romania (BNR).

"The investments in the real estate market can generate important risks in the economy, there is a high degree of market opacity," BNR warns.

For comparison, the stock of loans extended to the industry does not exceed RON 80 bln.

"The exposures to the residential real estate market, consisting of mortgages and guaranteed consumer loans, represent 68% of the total stock of loans granted to the population and stand at RON 101.8 bln as of March 2021, increasing by 7 % compared to the same period of the previous year," according to the most recent Financial Stability Report compiled by BNR, quoted by Ziarul Financiar.

Thus, over two-thirds of the loan portfolio granted to the population represent exposures of the banks in relation to the residential real estate market.

(Photo: Kittichai Boonpong Dreamstime)