In a context characterized by the deterioration of short- and medium-term economic prospects, Romanian banks significantly strengthened their lending standards in the second quarter of this year, both in the case of loans granted to the population and those granted to companies, according to BNR data. further strengthening of lending standards.
The most risky industries
From an industry perspective, banks’ perception of credit risk associated with non-financial companies continued to deteriorate.
This spring, banks rated 7 out of 10 sectors of the economy as significantly riskier. They consider the energy sector the most risky for the fifth quarter in a row. This sector is followed by transport (49% net interest), industry (43% net interest), agriculture (40% net interest, up 11 percentage points compared to the previous quarter), construction (31% net interest) and tourism ( 29% net interest).
Regarding the demand for loans, the banks pointed to ambiguous dynamics. Regarding the population, according to banks’ estimates, the demand for home loans decreased, while the demand for consumer loans increased. In the coming autumn, the demand for housing loans is expected to continue to decrease, while the demand for consumer loans will remain at the same time.
The share of real estate loans rejected by banks remained approximately unchanged
In the second quarter of 2022, Romanian banks reported a significant tightening of lending standards for loans intended for the purchase of housing and land (75% net interest) and a consistent tightening of standards for consumer loans (27% interest). In the third quarter of 2022, the respondent banks expect a slight strengthening of lending standards for both categories of consumer loans.
Banks also say (55.8%) that demand for home and land loans has been moderately lower, while 37% believe it has remained roughly flat. In terms of expectations for the next quarter, banks are betting on roughly unchanged demand for real estate loans, while 34.4% expect a decline in demand.
The share of real estate loans rejected by banks, calculated as the ratio of the total volume of requested and rejected loans to the total volume of loans assigned to the population, remained approximately unchanged during the last three months, this was indicated by 70.2% of respondents. actually 21.6%, but considering that this weight was moderately higher,
Source: Hot News RO
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