It was the first decline in two years.
“Successful recoveries were strongly affected by liquidity shortage of debtors. Thus, debt collection costs increased, and so did our success fees, due to increasing pressure,” the association said in a statement.
Romania’s debt management market rose 54% to EUR1.66 billion in 2010, after a 76% increase in the previous year. Banks were most prone to hire debt collectors or sell bad loans, due to the high number of payment delays on the backdrop of the financial crisis.
For 2011, the association estimates the local debt management market will decrease by 25%-30% on the year, due to a slowdown in private lending.
The Debt Management Service Association comprises 11 companies which own together around 80% of the local debt management market.