“The lack of predictability is the main problem affecting the Romanian banking system at the moment. You have no idea how many bills harmful to the banking system are currently under debate, some of them targeting the personal insolvency and the conversion of foreign currency loans into local currency,” Bogza, who is also president of Bancpost, told a conference on economic issues held Tuesday.
He added Romania pledged, during talks with officials of the International Monetary Fund (IMF) and the European Commission, that it would not adopt such bills.
At the request of the central bank and following pressure from representatives of the local banking sector, the Romanian authorities agreed with the IMF to introduce, in the stand-by loan programs and the letters of intent drafted up after each quarterly loan agreement review, several provisions whereby the Romanian authorities pledge not to adopt bills regarding individual consumers’ protection, such as the bills regulating personal insolvency and the conversion of foreign currency loans into local currency.
The IMF experts agreed that passing such bills into laws would hurt the financial stability, considering that the Romanian banking system faces one of the highest non-performing loan (NPL) rates in Europe.