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Banks in Romania hike provisions 2.4 times
Autor: Bancherul.ro
2009-04-22 18:47
Provisions set up by lenders in Romania surged 2.4 times (138 percent) year-on-year to 9.64 billion lei in February, while back payments for loans granted to the population doubled to 1.32 billion lei in the similar period, data of the country's central lender BNR show.

Provisions amounted to 4.05 billion lei at the end of February 2008 and 7.59 billion lei in December last year, pointing to a 27 percent increase in the first two months of 2009.

Almost 80 percent of provisions set up at the end of February (7.6 billion lei) were for loans classified as losses (loans with back payments larger than 90 days).

For credits classified as standard, provisions reached 559 million lei at the end of the second month this year, while banks provisioned some 512.5 million lei for loans under observation.

Provisions for substandard loans amounted to 456.5 million lei, while provisions for doubtful credits summed up to 509.1 million lei.

Arrears exceeding 30 days for credits contracted by the population continued to accelerate in February, advancing 17.6 percent on January and 111 percent on February 2008.

On January 31 2008, back payments for loans larger than 30 days had reached 1.125 billion lei following a 93.3 percent annual advance.

Arrears grew 35 percent since the beginning of the year from 981.2 million lei at the end of 2008.

Back payments of more than 90 days accounted for 1.09 billion lei of the total, while arrears for credits outside the balance sheet reached 94.23 million lei.

The largest back payments were reported for credits in national currency and amounted to 948.05 million lei, up 29.2 percent on the end of last year. Arrears for loans in euros summed up to 344.8 million lei, a 52.8 percent surge on December 31 2008.

Arrears for credits in dollars represented 3.8 million lei at the end of February, up 54 percent since the beginning of the year, while those for loans in other foreign currency (especially Swiss francs) summed up to 27.65 million lei.