Even though the central bank will give lei in exchange for the foreign currency-denominated assets, banks will be able to convert the amounts on the currency swap market.
This is a new step whereby the central bank expands the range of instruments that enable banks to get access to funding if faced with liquidity shortage or lose access to interbank market for various reasons that affect their risk profile.
BNR will evaluate these new assets by deducting 8% of their market value, according to a central bank decision.
Claudiu Cercel, head of financial markets with BRD-SocGen, says that all parties involved in some way or other, i.e. “the commercial banks, BNR, the Finance Ministry, the secondary government securities market” will stand to gain from this decision, which will ultimately improve the liquidity of the banking system.