Central Bank counselor: Banks borrow money with 10% interest and loan it with 35%

Marţi, 18 noiembrie 2008, 16:38 English | Business

Banks are in a point where they offer for deposits interest rates around 9-10% and ask for 35% interest for credits in the Romanian currency, RON, widening their margins and invoking new market conditions, said Adrian Vasilescu, counselor of the Central Bank Governor, during the Romanian Banking Forum. "They say conditions have changed. I wonder what are those segments that changed to much to allow such a difference", said Vasilescu.

During the past months, banks increased their interest rates for deposits up to a maximum of 14%, due to both he international conditions and the key interest rate increase at the Central Bank (currently at 10.25%). At the same time, interest rates for credits increased significantly, especially in October, when they reached even over 100%.

In his intervention, the BNR official also stated that the National Consumer's Protection Agency must put up a structure specialized in verifying banks.