Romania's central bank wants to reduce bad loans ratio to 6%

Romania’s National Bank (BNR) wants to reduce the non-performing loans ratio in the local banking system to 6% this year, BNR deputy governor Liviu Voinea said yesterday. The current NPL rate amounts to 9-10%. “Non-performing loans have continued to decline. This year we have a target of 6% for non-performing loans, aiming to reach the European average. We are, however, above the European average for the provisioning degree of these loans. From the budget perspective, Romania shouldn’t use public money for the banking system these years,” said Voinea, reports local Agerpres. Romania has low inflation, no deflation, and interest rates are at historic lows, according to the BNR deputy governor. “We have reduced the legislative uncertainty and the National Bank has contributed to this. Banks have continued cleaning their balance sheets of bad loans, they are capitalized and the contagion risk has been declining, while the net international reserves have been growing,” said the BNR official. editor@romania-insider.com