The stock of bank loans in Romania rose by 5.5% (3.4% in real terms) to RON 282.4 bln (EUR 58.0 bln, or some 29% of GDP) at the end of 2020.  

Besides the steady, robust advance in mortgage lending, the positive effects of the loan repayment moratorium on the stock of loans and the Government-backed IMM Invest scheme for corporate lending have also contributed to the performance.

Corporate lending still lags behind the retail (household, mainly mortgage) lending - but the gap is closing.

Thus, the stock of retail loans (local currency loans only) rose by 9.1% year-on-year in December, compared to a 7.5% advance for corporate loans.

However, as of June - before the IMM Invest scheme - the stock of corporate loans was down 1.2% year-on-year compared to the 11.1% advance in retail loans.

The low interest rate environment is likely to support lending in the coming quarters, but the sudden deterioration in the banks' loan portfolio once the moratorium expires will make an impact as well.

The Government has endorsed on January 27 the regulations for bank debtors willing to rely on the repayment moratorium facility in the first part of this year (within the maximum nine-month period allowed by the European banking authorities). 

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andrei@romania-insider.com