Isarescu: Financial stability is a precondition to any economic growth

Financial stability is a precondition to any economic growth, and recession in Romania would have been much more severe, if the banking crisis were not avoided, said on Thursday, at a colloquy at the National Bank of Romania / BNR /, Governor Mugur Isarescu.

‘It’s no use to talk of economic growth, if you do not ensure financial stability. Let us no longer play with the issue of financial stability, to expect Mrs Lagarde to come (Christine Lagarde, IMF Director General – editor’s note) to Romania, to make a miracle. If miracles are needed, I invite the media to go to Maglavit, tosearch for Petrache Lupu. We should stimulate employment, innovation, capital, not credits given one does not know where, not relaxing the prudential conditions’, said Isărescu.

The BNR official stressed that Romania has avoided a banking crisis during this period, certainly with international financial assistance, and not only financial.

‘From my point of view, in terms of economy, there is no other thing worse than a financial and banking crisis. It is devastating and has effects for many generations (…) You see how much money was poured in the developed countries to save the big banks. We had a recession in Romania, the recession would have been much stronger, accompanied by a financial and banking crisis’, Isarescu also said.

The BNR governor said, at the same time, that Romania’s administrative capacity to absorb free money from EU funds was massively and painfully over-evaluated.

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