Non-governmental credit, up 6.4pct at end H1 2010
Non-governmental credit increased 6.4 percent (2 percent in real terms) at end-June 2010 from June 30, 2009 as a result of a 13-percent rise in the forex component of the credit stated in RON (when stated in euros, the rise was 8.8 percent) and a 3-percent decline in the RON component (7.1 percent in real terms), the National Bank of Romania (BNR) says in its 5th Report on Financial Stability.
Forex loans made up nearly 60 percent of the total volume of non-governmental credit January 2009 – March 2010, with the proportion going slightly up in the months thereafter.
In terms of maturity, all loans recorded annual negative rates as of end-March 2010, with a deeper fall in medium-term loans (a 6-percent decline) and short-term loans (a 1-percent decline.
In the case of long-term loans, the contraction was smaller (minus 0.05 percent). Long-term loans made up 57.3 percent of the total credit structure; medium and short-term loans were 19.7 percent of the total and 23 percent of the total loans extended to the private sector as of June 30, 2010.
The developments in the long-term forex loans was partly sustained by a rise in euro¬denominated loans for property purchasing (including the ‘First Home’ home-buying programme) in the case of individuals, as well as by rescheduling extended to companies to allow them to service their debt.
Credit to the private sector slowed down visibly as from the last quarter of 2008. The annual growth rate in nominal terms went down from 33.7 percent in December 2008 to 0.9 percent in December 2009, steering to negative territory as from January 2010, for the first time on the past 10 years: minus 3.5 percent in January; minus 3.7 percent in February and minus 1.6 percent in March.
The trend reversed to positive territory starting April 2010: plus 0.5 percent in April; plus 1.4 percent in May and plus 3.8 percent in June. As of end H1 2010 the banking system was recording a loss of RON 234.8 million.