Romanian National Bank: Romanians Borrow Money to Eat

The Romanian National Bank conducted a survey revealing Romanians’ sad reality. The population eats and dresses on credit, and real estate loans are becoming less and less.

In Q2, banks significantly tightened their lending rules, and Q3 will likely continue the same. The riskiest industry is still the energy one. While demand for consumer loans soared, demand for house loans decreased.

Banks’ perception of credit risk associated with non-financial companies continued to deteriorate. The Banks are rating seven of the ten sectors as significantly riskier in Q2 2022 compared to the previous quarter.

The banks reported a mixed progression in Q2 2022 for the loan demand. As a result, credit institutions determined that in the case of the population, the need for housing loans decreased while the demand for consumer loans increased.

It is projected that the demand for consumer loans will remain unchanged for Q3 2022, while the demand for housing loans will continue to decline.

Most survey participants (65,1%) reported that the demand for consumer loans was essentially unchanged in Q2 2022, while 34,9% said there was a slightly more significant need.

Banks reported stable demand for consumer loans with mortgages, and for credit cards, 50% of credit institutions think the demand increased, while the remaining 49.5 say it remained unchanged.

Most respondents (63% ) claimed that demand for unsecured consumer loans remained stable, and 37% claimed demand increased.

Consumer loans are anticipated to be in high demand from the general public in the third quarter.

Like real estate loans, 84% of the institutions who responded claimed that the rejection rate for consumer loans was almost steady, with 16% believed to be slightly lower.

In short, the Romanians borrow money from the bank to survive. If this point has been reached, what will happen next?