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Isarescu: National Bank has doubts about the way in which the tax on banks is applied

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The accusation that the National Bank is pressuring banks in relation to the Romanian Interbank Offered Rate (ROBOR) index is nonsense, Governor of the National Bank of Romania (BNR) Mugur Isarescu stated on Tuesday, mentioning the interest rate is the main instrument of the monetary policy.

"Ask him [Eugen Teodorovici, Finance Minister, ed.n.] what he meant to say. I don't know what he intended to say, but I can make a comment here. What pressure? This is our instrument after all. We are not putting any pressure. If a problem arises we move the interest rate up and down as we have done before. It is the main instrument of the monetary policy. So us putting pressure is purely nonsense. What pressure could we possibly put?!" Isarescu said when asked about Finance minister's accusation that BNR is aggressively pressuring banks not to lower ROBOR.

The governor mentioned having heard "in the market" about Finance Minister Eugen Teodorovici's invitation of discussing this situation at the ministry, just as the head of Finance announced having heard "in the market that BNR is aggressively pressuring banks" not to lower ROBOR.

"I don't know, I haven't heard, or I have heard, so to speak, in the market, but these discussions are not to be carried out as chit chat, on TV, no. We haven't received any document yet," Isarescu affirmed.

Moreover, he said it is not the independence of the central bank that will be affected by the new tax, but the flexibility and efficiency of the monetary policy "which, to spell it out, will not help the Government."

Isarescu also said that the National Bank has doubts about the way in which the tax on banks is applied and will request that the ordinance be discussed in the National Committee for Macro-prudential Supervision, because it has a systemic impact.

"The main element of dissatisfaction is that you take such a measure - they have been taken in Europe, not in all countries, in a few - not related to the interbank offered rate ROBOR, this is an 'innovation', talks with the industry have been conducted. This is what the Constitution says. This is what Romania's laws specify. So, you talk to the banking industry. At the end of the year, close to Christmas, you come with such a bomb, hard to understand in the first place. Right? So, I believe this is the first dissatisfaction and I believe Mr Minister of Finance will finally talk to the industry, discuss with them in a clear way. They also have questions, how it applies. I have to tell you that we also have [questions, ed.n.], there are parts of the law that we hardly understand. Let me tell you another thing: normally, such an ordinance should first be presented to the National Committee for Macro-prudential Supervision. It has an impact, and we will probably request that we have a discussion in an extraordinary sitting of the committee," said Mugur Isarescu, asked to comment the wave of discontent about "the tax on greed".

He said that until now he has not received any formal invitation from the Finance Ministry to discuss this tax, but the institution was asked for an impact assessment after the ordinance had been given, although the assessment is normally done before.

Moreover, Isarescu stressed that the decrease of the interbank offered rate ROBOR in the last days is not related to the introduced tax, its decrease having begun since last September.

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