In Romania, the bank privatisation process was considered as essential for the progress of the restructuring of inefficient state-run companies, via strong budgetary constraints, Central Bank Governor Mugur Isarescu said during the Annual Conference of the European Association of Bank History, quoted by HotNews. “Starting with 2006, the banks with foreign capital controlled approximately 80 pc of the banking system’s capital and assets, which led to the deepening of financial intermediation, the improvement of financial services (new products, know-how), but also to the EURO-ization of the economy, complications in drafting the monetary policy and, more recently, the accelerated dis-intermediation,” Isarescu said. According to the governor, Central and Eastern Europe is the only region of the world where banks with foreign hold the majority of assets. “The presence of international banking groups was considered an advantage in terms of financing accessibility and management, but the crisis revealed certain vulnerabilities. One is the increased risk of contagion (the Greek crisis), and another is the risk of decreasing the rating of the capital’s country of origin,” Isarescu explained. He gave Austria as example: “Recently, the rating of banks was decreased, and the perception that in Romania there was and still is a disaster, that Romanian banks with Austrian capital will have problems – which is not true – represents just a vulnerability.” The banks involved in financial intermediation improved their service, which is alright, Isarescu emphasised, but “we have the problem of the EURO-ization of the economy and the implementation of economic policies after the significant growth of loans,” the BNR official mentioned.