Individuals’ overdue loan payments have started climbing again, as Government’s austerity measures are coming into effect, and high provision expenses come to eat up large banks’ entire operating incomes, says Nicolae Cinteză, head of NBR’s supervision department.
“Large banks are in the black from what they piled up in the
first half of the year, but they have started raking up losses
lately. Provisions are being set up as the effect of Government’s
steps starts being felt. Individuals’ overdue payments are rising
and the worst is yet to come,” Cinteză warns.
He says that there are significant losses in the entire banking
system after the first seven months of the year, without specifying
their level, yet.
In the first half, net losses amounted to 56m euros at system
level, generally as a result of losses accumulated by medium-sized
and small players, while large banks still reported profits.
Cinteză added that the provision outburst is now compounded by the
impact of the ordinance regarding consumer loans, which is likely
to generate significant losses to some players, if it is not
amended.