Companies in Romania, not prepared to cope with interest rises

More than half of the local companies with loans in lei and euro would be significantly affected by a possible 3 percentage point increase in the interest rate on both lei and the euro, according to a survey Romania’s National Bank (BNR) concluded in September 2017, reports local Ziarul Financiar. Three extra percentage points above a ROBOR level of about 1% (the value at the time of the study) is the maximum limit that many local firms can afford. In other words, a 4% ROBOR would prove catastrophic for investment and would send many private companies into default. The 3-month ROBOR (ROBOR 3M), the interest rate at which banks lend to each other in Romania, reached 2.1% on December 18. Companies and individuals will have to pay higher instalments at the bank in the first month of the next year, as banks will update their interest rates in January. They will include in the new rates the ROBOR increase during September-December 2017. editor@romania-insider.com