„I think that the first six months of 2010 will be decisive for the Romanian banking system”, said Cinteza. Nevertheless, he thinks that the Romanian banks situation is adequate in terms of capital needs covering, and the banks sensed the danger in time and took the adequate measures.
Provisions at the level of Romania’s banking system were up to 12.9 67 million lei on Sept. 30 as against 3.642 million lei on Dec. 31, 2007, pointed out Nicolae Cinteza. Provisions are amounts destined to cover risks the commercial banks are committed to set up, according to BNR norms.
Cinteza stressed that the banks’ lackluster performance is set to get accentuated, and that determined the doubling of provisions from 6.065 million lei nine months into 2008, up to 12.967 million lei on Sept. 30, 2009. „Despite that, the solvency degree is still very good, of 13.7 percent, due to BNR prudent policy”, said Cinteza. There is a very, very clear trend of asset depreciation and banks reported profits is not the consequence of their activity of lending.
„Banking system profitability is the result of BNR measures to deduct the collateral amount, for which provisions were not set up, in the case of loans falling due on periods higher than 90 days”, explained Cinteza. 88 percent of the capital demand at the level of the Romanian banking system is determined by the credit risk, 11 percent by the operational risk and 1 percent by the non-payment risk, according to BNR data.
„Most likely, two new indicators will be introduced, in our ongoing study for two years. The first is Tier-1 indicator, the calculation of the total capital adequacy ratios to the risk indicators, which should be higher than 7 – 9 percent of own capital. The second indicator is the Effect of leverage on 1st level own capital calculated according to assets, at an accepted level of 4-5 percent reported to own capitals”, explained BNR director.
The top five foreign banks in Romania concentrate assets of 175.2 billion lei, loans of 126.2 billion lei, own capitals of 13.2 billion lei and deposits of 112.2 billion lei.
Nicolae Cinteza took part in a financial banking seminar organized by BNR, Alpha Bank and the Romanian Banks Association.