According to the stability report published on Wednesday by the Central Bank, the population’s ability to pay bank contributions has slightly deteriorated. “This evolution took place against the backdrop of rising monthly rates due to higher interest rates, which were only partially offset by higher wages,” the report said.

It is worth noting, the heads of the central bank add, that loans in foreign currency have a level of non-performing loans twice as high as in the case of loans in lei.

A separate category of borrowers is subject to more careful monitoring. We are talking about those who postponed the payment of installments on the basis of moratoriums introduced as a result of the outbreak of the COVID-19 pandemic. “It has been proven that these borrowers have difficulties in servicing their debt after the end of the moratorium and have almost 5 times the level of non-performing loans, and the volume of problem loans of this category of borrowers is about 14 percent of the total amount of non-performing loans, although, compared to the total number, these loans make up only 4 percent,” the Report says.

The category of the most risky borrowers includes borrowers who are late in paying installments under moratoriums

Debtors who have delayed payment of installments on the basis of the moratorium belong to the category of the most risky debtors, having an average level of indebtedness at the time of granting well above the prudential limit, that is, about 57 percent.

Vulnerable borrowers, defined as borrowers with a debt-to-equity ratio of more than 45 percent, register the highest share in the case of consumer secured loans (42 percent) and first home/new home loans (41 percent, September 2023).

As of September 2023, the annual default rate has increased slightly, and the outlook for borrowers’ solvency is mixed.

On the one hand, borrowers’ ability to recover financially among those who were more than 90 days late in paying installments a year ago (September 2022) has recently deteriorated.

Only 3.5 percent of loans more than 90 days delinquent in September 2022 returned to payment in less than 3 months, which is less than in 2019, while 83 percent of them remained in the non-performing category (more than 90 days delinquent).

In the next 12 months, a slight increase in the probability of default is expected for both mortgage and consumer loans.

In this context, the Center for Alternative Dispute Resolution in the Banking Sector (CSALB) comes to the aid of debtors who are facing difficulties, restoring the balance of relations between creditors and consumers and increasing the confidence of the latter in the use of financial and banking services. . The importance and usefulness of this mediation is emphasized by the increase in the number of both claims and settlements