Romania’s Consumer Protection Authority (ANPC) has fined local lender Raiffeisen Bank with RON 50,000 (EUR 11,000) for incorrect practices in relation to debtors in Swiss francs.
ANPC will set up a committee in the coming days to determine whether the institution’s president will issue an injunction order to end these practices, ANPC president Marcel Bogdan Pandelica told Profit.ro.
Raiffeisen Bank introduced Swiss-denominated loans in Romania in 2006. It covered the related risks by introducing in contracts a clause that gave it the right to increase the interest rate discretionarily, according to internal Raiffeisen Bank documents. Clients with loans in Swiss francs considered that the bank covered its currency risk on their behalf, including by increasing the interest rates with the justification that the conditions in the financial market have changed.
The bank didn’t inform the customers about the loan’s future costs, which led customers to making decisions they would not otherwise have taken, according to ANPC.
Raiffeisen Bank will challenge the decision in court. The bank still has about 5,200 loans in Swiss francs worth about EUR 185 million, down from 11,600 loans worth EUR 450 million at the end of 2008.