NBR reveals: Unirea has lost its licence

The National Bank of Romania (NBR) decided to pull the plug on Banca Comerciala Unirea (Unirea Commercial Bank). On Monday, after several months of uncertainty, NBR provided the first official information about the situation of this bank. The conclusion? Unirea is no longer licensed to operate.

Banca Unirea has been short of liquidity for over a year now and failed to comply with the obligations imposed by NBR and the banking law ever since.

At the end of May, Unirea Bank announced it had found an investor – a consortium led by a Russian bank, but so far neither the money, nor any other proof of serious involvement has come up. Empty words were not good enough for NBR, which at the end of last week decided to withdraw Unirea’s operating licence.

“The Board of Directors of the National Bank of Romania decided to withdraw Banca Unirea’s operating licence and this is an administrative measure,” Adrian Vasilescu, NBR governor Mugur Isarescu’s adviser, said on Monday.

Vasilescu said the main reasons for this decision were the insufficient equity capital registered by Unirea, the too high exposure on credits, as well as the problems about management authorisation.

“Four were the reasons why the Board made this decision. First of all, NBR’s requirements of a total equity capital of 150bn lei were not met and too high exposures on credits granted to a single client were registered.

At the same time, the bank has not appointed the two authorised managers as the banking law stipulates for quite a while. Last, but not least, Unirea has not built its minimal compulsory reserves in a long time,” governor Isarescu’s advisor explained.

Emil Botea, chairman of Banca Unirea’s Board claims he has not received any official notification from NBR about the licence being withdrawn yet.

“I know nothing about it. We submitted documents to NBR showing that everything was due to the accounting registration of the data about the capital, equity capital and other indicators,” Botea said.