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The financing of the real economy, particularly of small and medium-sized enterprises (SMEs) is unsatisfactory, Isarescu says

Loans extended in the local currency, the leu (RON), are on a clear expansion, but the financing of the real economy, particularly of small and medium-sized enterprises (SMEs) is unsatisfactory, Governor of the National Bank of Romania (BNR) Mugur Isarescu said Thursday at a press conference where he released BNR's latest inflation quarterly report. 

'There is a clear expansion of the RON-denominated loans as a result of drops in interest rates. A necessary balance between RON and forex-denominated loans is thus being achieved. That means our measures have worked. The total loan stock is still in negative territory, but the rise in RON-crediting is larger than the drop in forex-crediting. (...) Yet, RON-crediting of companies still does not satisfy me,' Isarescu explained. 

He admitted that RON-crediting was up particularly on the 'First Home' programme and the fact that 15-20-year loans are taken out is a sign of trust in the central bank. 

On the other hand, the BNR governor said the funding of companies is fragile, while the funding of SMEs is 'worse than fragile.' 

At the same time, Isarescu reiterated his message to the banks to get closer to customers and settle the dispute between the two camps. 

'There are mutual accusations. Some say companies are undercapitalised, and they are right, but they have to be helped raise capital. (...) On the other hand, others say that the loan terms of the banks are hard and the banks do not make correct analyses. In short, I personally, am not satisfied. I have data from the real economy, from the grassroots... There is a lot to be done,' said Isarescu.  

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