Total lending stayed in positive territory in for the third month in a row in October, having increased by 0.3%.
The increase in leu lending helped total lending stay in positive territory but the growth pace slowed down somewhat due to the decline of foreign currency lending by 12.3% year on year to RON105.7 billion.
The rise of leu lending was helped by the decline in interest rates to all-time lows, following Romania’s central bank’s key rate cuts.
Leu-denominated retail loans surged by 28.4% compared with October 2014, reaching RON50.9 billion.
“The increase in consumer confidence in the economy amid the rise in disposable income rekindled the appetite for loans. The leu interest rates at all-time lows and the prospects of them staying there (or maybe going down further) for at least a year, as well as the loan-to-deposit ratio of the banking system below one should keep lending conditions favorable over the coming period,” says Ciprian Dascalu, ING Bank chief economist. (EUR1=RON4.4509)
English version by Loredana Fratila-Cristescu