Ro­ma­nia ready to help lo­cal Greek len­ders

Kathimerini English - - Business & Finance -

Ro­ma­nia’s cen­tral bank has a plan to aid the units of Greek banks op­er­at­ing in the coun­try, in case the deep­en­ing debt cri­sis in the Mediter­ranean coun­try shuts down fund­ing flows from the par­ent len­ders, First Deputy Gov­er­nor Florin Ge­orgescu said.

“In case one of the Greek own­ers shows it doesn’t have the abil­ity to fi­nan­cially sup­port its unit in Ro­ma­nia, we can ap­ply these mea­sures grad­u­ally, in the ap­pro­pri­ate dosage, which is not the case now,’’ Ge­orgescu told re­porters in Bucharest yes­ter­day.

“We don’t have the obli­ga­tion to act pre­ven­tively, un­der the law, and we have a plan to re­act, if needed, which in­cludes cer­tain mea­sures,’’ he said, with­out pro­vid­ing fur­ther de­tails.

The East­ern Euro­pean coun­try’s Banca Na­tion­ala a Ro­maniei is mon­i­tor­ing Greek-owned banks on a weekly ba­sis be­cause they con­trol about 17 per­cent of the Ro­ma­nian bank­ing in­dus­try.

The Greek banks’ Ro­ma­nian units, in­clud­ing Al­pha Bank, Eurobank EFG and Na­tional Bank of Greece (NBG), are “well cap­i­tal­ized’’ at this point and have a sol­vency ra­tio of 15.7 per­cent, one per­cent­age point above the bank­ing sec­tor’s av­er­age, Ge­orgescu also said.

Ro­ma­nia’s bank­ing in­dus­try is dom­i­nated by Aus­trian len­ders, which con­trol about 38 per­cent of the mar­ket, fol­lowed by Greek banks and French len­ders with 15 per­cent.

Mean­while, Stan­dard & Poor’s cut its long-term credit rat­ing yes­ter­day on United Bul­gar­ian Bank (UBB) to B-from B, af­ter par­ent com­pany NBG was down­graded. “The con­tin­ued weak­en­ing of NBG’s cred­it­wor­thi­ness raises the risk of con­ta­gion for UBB, in terms of rep­u­ta­tion and fund­ing, par­tic­u­larly in the con­fi­dence-sen­si­tive whole­sale mar­kets,” S&P said in a state­ment.

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