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January 19, 2021

BNR official: Poorest 10pct citizens have difficulties in reimbursing loans 80 pct of time, similarly, 40 pct of well-off

The poorest 10 percent of the citizens encounter difficulty in repaying loans about 80 percent of the time, while the richest 10 percent face similar difficulties only face 40 percent of the time, stated Thursday Valentin Lazea, chief-economist of the National Bank of Romania (BNR), during a conference.

“We are talking about poverty on every tenth part of the population, that is, every 10 percent of the population. For example, 10 percent of the citizens encounter difficulty in repaying loans about 80 percent of the time. Even the first tenth part, that is, the well-off 10 percent, has difficulty about 40 percent of the time. The population is much poorer than in Europe. Even if lending as a ratio to the Gross Domestic Product (GDP) is lower than in Europe, lending as a ratio to the wealth of the population is similar in Romania to that of Europe, due to the poverty of the population. Here the solutions are the increase of income on the basis of labor productivity and so on,” said Lazea.

According to data released by the National Bank of Romania (BNR), the number of individuals with over 30 days arrears in banks and non-banking financial institutions decreased by 0.8 percent in April, as compared to the previous month, to 668,682.

These persons had arrears of over 8 billion lei. Most of the amount was in RON and EUR, namely 3.08 billion in lei and 3.29 billion lei in euro. Depending on the delay category, the highest value corresponds to the term of over 90 days, by 4.52 billion lei.

The arrears of companies and households with banks decreased by 32.7 percent, from April 2016 to the same month of this year, to 13.21 billion lei. Of this amount, 6.08 billion lei was in the national currency and 7.13 billion in foreign currency. The capital city held 32.5 percent of the total arrears.

The rate of non-performing loans decreased in March against the previous month by 0.22 percentage points, to 9.36 percent. As compared to March 2016, it fell by 4.16 percentage points.

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