However, compared with the September 2016, the non-resident deposits are more than 20% lower.
It remains to be seen whether they bounce back by the end of the year or there is a further decline in the financing allocated by the foreign banks to the local market.
Whereas the non-residents’ deposits stood at EUR3.55 billion in January, they dropped to EUR3.4 billion at the end of the first quarter and then to EUR3.19 billion by the end of the first half, with the downward trend continuing over the summer. The fall brought a slight rebound.
Foreign currency lending has been dwindling in the past few years, as the cost of leu loans came close to the cost of foreign currency loans, and potential customers did not want to take on the foreign currency risk. Unable to find solvent demand, lenders could decide to repay some of the funding to their parent banks. The decline in foreign currency lending has slowed down somewhat lately, though. In September 2017, lending in foreign currency was down 5.3% on the year-ago period to the equivalent of 89.9 billion lei. (EUR19.33 billion).
The non-resident deposits decline started in 2012 after having gone up at the start of the crisis and peaking at EUR8.65 billion in August 2011. (EUR1=RON4.6497)
(English version by Loredana Fratila-Cristescu)