As the central bank cut the key rate, commercial banks followed suit and eased the burden of those who took out loans in lei, though not without a certain delay.
Romania’s central bank decisions over the past two years that halved the key rate from 5% to 2.5% have made an impact on the banks’ customers, who are now taking out leu loans at 6% a year compared with 11% in 2013. On the other hand, those with deposits in the bank are getting only 3%, compared with an average of 5% per annum in 2013.
“Leu loan interests are substantially lower and more competitive with the euro loan interests. This explains the faster progress of leu lending compared with foreign currency lending,” central bank governor Mugur Isarescu said at the press briefing after the monetary policy meeting on Wednesday.
“There has been a certain delay between our moves and the moves of the commercial banks, which was to be expected. There will always be some delay. The interest rate cuts will continue with a certain delay. Even if we stop the easing cycle, when we do, commercial banks will probably continue their cuts.”
(English version by Loredana Fratila-Cristescu)