“The central bank is inclined to cut its main interest rates to stimulate the economic growth. However, the Romanian market is highly competitive… the financing is limited, and so interest rates tend to get higher, as the banks are trying to keep their margins,” said Guy Poupet.
Early February, the central bank lowered its key rate by a quarter of a point to a record low of 5.5% a year, the third cut in four months, in a move to boost lending and support the economy.
“For now we see the rates on an upward path, for both loan and deposits,” Poupet added.
Over 60% of BRD’s deposits are in Romanian lei, while 55% of the lending is in foreign currency.
“I find it difficult to believe that we will be able to lower the euro-denominated lending markedly over the next period,” said Claudiu Cercel, deputy general manager of BRD.
He said the interest rates on euro loans also started to increase in the recent period, but the growth is not yet visible.