Its time to be worried by the Romanian NPL rate

Non-performing loans have been increasing in Romania since 2009 at an alarming rate in my view. The current level of 17.34% is high by any standard.

The next two graphs show that the credit/deposit ratio is almost as high as it was during the credit boom of 2008 while the NPL rate is at historical highs for Romania.

In the next ECONOMIA 19.11.2012 FLORIN CITU ADVISORY looks at this issue and at what are the implications for the Romanian economy going forward. Applied econometric research has shown that after a certain level NPL’s have a negative impact on credit growth. Is Romania at that level? Also, how sustainable is the current situation of increasing NPLs, more provisions and capital flight? Is the Romanian situation different? We look at all these questions in the report.

Florin Citu is the founder of FLORIN CITU ADVISORY , an independent economic research and consulting firm. More details will be available in English on our page soon. Until then please contact us at


6 thoughts on “Its time to be worried by the Romanian NPL rate

  1. @Florin
    When a credit is considered to be non-performing?
    I don’t know the exact conditions that make a loan
    to be considered non-performing.

      1. Eu aveam impresia ca restantele in cauza sunt cele raportate catre CRB sau CRC (cum inteleg ca se numeste acum), adica plati cu intarzieri mai mari de 30 de zile. Daca sunt plati peste 90 de zile atunci intr-adevar situatia devine ingrijoratoare.

      2. @ddr
        • >90 zile: 12 ţări (România; Bulgaria,Cipru, Grecia,
        Macedonia, Serbia, Ungaria, Polonia,
        Republica Cehă, Ucraina, Letonia, Austria)
        • >60 zile: 2 ţări (Estonia, Lituania)
        • >30 zile: 1 ţară (Rusia >30 zile – persoane juridice

  2. Maybe that level of NPL is distorted by the low level of new loans. If the bad part remains the same and the good part is diminishing, the bad part looks bigger.

  3. Graficul 2: Nivelul creditelor neperformante ar trebui comparat cu capitalul propriu al bancilor si vazut astfel daca aceste credite neperformante “stau” numai pe banii bancherilor sau sunt sustinute si cu banii clientilor.

    Din cate stiu eu capitalizarea bancilor este mai mica de 10% din volumul expunerilor si intrucat neperformantele depasesc 17 % din acelasi volum imi rezulta ca teoretic banii anumitor depunatori au ajuns la anumiti clienti care nu-i mai pot da inapoi.

    Graficul 1: Intrucat bancile trebuie sa depuna la BNR RMO-uri de 15-20% si sa provizioneze integral cele 17% credite neperformante, cum reusesc ele sa aiba totusi suficienti bani incat sa dea credite de 120% din nivelul depozitelor, adica mult mai multi bani decat au primit ele?

    Cazul fericit ar fi sa sustina aceste credite cu finantari de la bancile mama, dar cu siguranta sunt si finantari de la BNR si mai ales lichiditatile “la vedere” din conturile clientilor…

    Dupa parerea mea acest sistem bancar este o mare gogoasa, in care bancherii risca foarte putin facand bani cu banii altora, iar cand gogoasa se va sparge vor plati atat depunatorii in nume personal cat si BNR-ul in numele intregii societati.
    Si camatarii sunt mai onesti. Ei macar dau imprumut si isi risca banii lor…

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