The installments on unpaid loans reached RON19.4 billion (EUR4.6 billion) at the end of June, accounting for 9% of overall loans, according to data from the National Bank of Romania (BNR).
Leu-denominated loans, most of which are unsecured consumer loans, are the most problematic for bankers, with the share of overdue installments on this segment amounting to nearly 11%.
For instance, in Bistrita-Nasaud, the share of overdue leu-denominated loans to the total had climbed to 19.3% at the end of last month, while in three other counties (Galati, Suceava and Botosani) their share exceeded 15%. Bankers say usually the biggest problems occur in areas with a weak economy.
“Differences from one county to the next are quite significant, with certain areas being worse off because of the unemployment rate and the income level. We conducted a risk analysis on a regional basis and are monitoring problem areas more closely, but we don’t have different lending terms for clients in these counties,” says Gabriela Nistor, executive manager in charge of retail at Banca Transilvania.
Ialomita and Bistrita Nasaud are two of the counties with the weakest economies, while Galati is a county dependent on two industry sectors that were affected by the crisis in 2009 and the first half of 2010 – the steel industry and the ship building industry.
The share of foreign currency-denominated overdue loans also fluctuates significantly. Whilst the national average is around 8%, there are counties where the share of overdue loans exceeds 17% such as Ialomita and Giurgiu. In Alba, Arad and Galati around 14% of foreign currency-denominated loans are overdue.
(English version by Daniela Stoican, edited by Loredana Fratila-Cristescu)