The way of financing the domestic economy is characterized by some seemingly paradoxical behaviors, Romania having the lowest degree of financial intermediation, but also the highest growth rate of lending, said on Tuesday, Florian Neagu, deputy director within the Directorate Financial Stability of the National Bank of Romania (BNR), according to Agerpres.

„On the one hand, we have the lowest degree of financial intermediation in the European Union, i.e. the share of bank credit in the Gross Domestic Product is by far at the lowest level and it has been so for the last two decades, it is not something that appeared in the last period. And the second evolution is that when we look at the dynamics of financing granted to companies in the last two to three years, also, in European comparisons, we have by far the highest rate of growth of credit given to companies,” Florian Neagu told the conference „Productive Romanian money – financing of the private economy”, an event organized by cursdeguvernare.ro.

According to the source, equity represents the main element of the liabilities of companies in Romania, being an essential element when judging the degree of banking. Neagu claims that the positive part of the last 5 years is the increase in the capitalization of the economy, and the share of equity in total liabilities increased from 30 pct in 2016 to 37 pct in 2021. However, the capitalization deficit in the Romanian economy remains at a chronic level, there are over 200,000 companies that fail to meet the minimum level of capitalization required by law, of 200 RON. The amount that entrepreneurs should bring to capitalize their own companies is significant, almost 136 billion RON, an amount equivalent to the funds we could attract through the PNRR channel, he added.

The deputy director with the Financial Stability Directorate of the BNR also referred to commercial debts, noting that the arrears rate for these types of debts is triple versus non-performing loans.

Regarding the type of companies financed by banks, the data presented by the central bank official show that more than 70 pct of the loan portfolio is granted to companies with domestic capital. Companies with foreign capital are mainly financed from abroad.

Also, Florian Neagu referred to the role of government programmes implemented so far to stimulate the financing of companies. The stock of such credits has reached almost 30 billion RON, and as a flow, almost half of the credits given in the economy in the last year represent loans given through such programmes.

Agerpres