The supervisors at the National Bank of Romania were on a conference call with their counterparts in Austria on Tuesday to discuss their intentions to force the major Austrian banks Erste, UniCredit Bank Austria and Raiffeisen to reduce lending in the region depending on the self-financing capability of the local subsidiaries, banking sources say.
BNR wants to know what methods the National Bank of Austria and the Austrian Financial Market Authority will employ next year, when they monitor the ratio of new loans granted by the local branches of Austrian banks and the local refinancing they get.
After having dropped the bomb two weeks ago, the Austrians have not publicly revealed any other explanations, thus igniting a real scandal after President Traian Basescu himself issued harsh warnings to Austrian banks to keep them from cutting financing.
Banking sources say the Austrian supervisors have not previously discussed the issue with the central banks in the countries that will be affected by the new rules and are doing it just now. On the other hand, BNR has avoided criticizing its Austrian counterparts thus far.
Whereas the other banks would rather not say anything, Erste and Raiffeisen felt pressured to respond and the bosses of the two banks, Andreas Treichl and Herbert Stepic, sought to calm things down reassuring that BCR and Raiffeisen Bank branches will not suffer as a result of the new regulations.
“I don’t see any problem for Raiffeisen Bank Romania as a result of the new requirements of the Austrian regulators that will come into force in 2012,” said Herbert Stepic told ZF. Lending increase in Romania is more tightly connected to the gross domestic product trend than in the past, which will remain very far from the rates before the crisis, he added.
In addition, the Austrian banker says that when calculating the credit/deposit ratio, the Austrian watchdog also takes into account the refinancing from such institutions as the European Bank for Reconstruction and Development and European Investment Bank. Both Raiffeisen and BCR have significant lines of credit from the two lenders.
On the other, BNR only takes into account the traditional deposits and maybe also loans placed as deposits by contract.
Regardless of the clarifications of the Austrian bankers that should calm down customers and Romanian authorities, international media continues to write about how the Central and Eastern Europe would be hurt by the euro zone bank problems and particularly by the restrictions that will be imposed on Austrian banks.