Alpha Bank: no more down payments

Alpha Bank will offer real estate credits with 0% down payment starting next week, while the upper indebtedness limit will rise to 65% of net incomes for certain client categories. “I expect there will be a significant rise on the segment of clients with above average incomes, who decide to take out high-value real estate credits and credits for personal needs of over 50,000 euros,” Sergiu Oprescu, president of Alpha Bank, told ZF. According to the bank’s internal regulations, when deciding on the indebtedness level, it will take into account the clients’ income minus the subsistence basket. The value of the basket, approved by the NBR (National Bank of Romania), has been set at 735 RON (222 euros) per month for a family of three. “A high valued basket is to the disadvantage of families with below average incomes. For them, the indebtedness level will drop in comparison to the previous norms of the NBR,” explained Oprescu. By contrast, clients with above average incomes will be able to borrow higher sums. The deduction of the subsistence basket makes it impossible for clients with low incomes to exceed their reimbursement capacity, this being one of the criteria imposed by the central bank. The head of Alpha Bank said it had to go down a thorny path in order to secure the central bank’s opinion, which meant it had to take many steps in order to modify the norms. “The NBR asked us to do it, and we established an indebtedness level based on the client’s risk category, which has to take into consideration their payment track record, the type of product applied for, and the percentage obtained within the bank’s scoring system,” said Oprescu.