Verida Credit: We have cut our original business target to a third

Verida Credit, the mortgage lending company launched on the Romanian market last summer, has reduced its original business target to a third due to changed market conditions, said Carmen Retegan, the company’s general manager. Originally, Verida had set itself a target of 100 million euros in credits granted for the end of 2009, but now, it is expecting the value to be of around 30 million euros. The mortgage lending market is one of the segments most affected by the crisis, because of the more expensive liquidity, of its shortage on the market and of the uncertainties related to the progression of prices on the real estate market. “The crisis made us put off all our plans. This year, we were supposed to open four offices (currently, the company has two), but we froze expansion. The crisis also changed our means of funding, now it’s more difficult and more expensive for us to finance our operations. For 2009, we expect to see a third of the growth we had originally anticipated, i.e. 30 million euros, a realistic value under the current terms,” Retegan told ZF in an interviewa. Verida was launched on the market in July 2008, when the crisis had already intensified in the US, but on the Romanian market managers were still optimistic, and were not expecting Romania to be affected by the international turmoil. “We started lending in the second half of 2008, and granted half a million euros in loans, but in December we halted our activity for three months, and resumed it on March 1st. We stopped operations due to the market uncertainties, we didn’t know how much to charge for our products, because prices were changing from one day to another and we had to seek other sources of funding, because the funding we were supposed to receive from our shareholders was put off due to their own problems,” explains Retegan. Verida is controlled by Dutch company Ipocredit, in turn set up by a Citi investment fund, Old Lane, by Netherland’s ABN Amro and by American fund Rubikon Partners.