Only 14 pc of SMEs take out loans from Romanian banks

December 5th, 2007

SME BNR small and medium-sized enterprisesOnly 14 per cent of the small and medium-sized enterprises (SMEs) have taken out a bank loan, according to First Deputy Governor of the Central Bank, Florin Georgescu, quoted by Rompres. BNR statistics suggest that a majority of companies are financed by their parent companies, the value of the money raised in that way representing nearly half of the domestic corporate credit. Almost half of the loans extended by banks to SMEs are treasury loans having the company cash flow (revenue and cash) for collateral, and 31 per cent of financing goes into investing in equipment. The BNR data shows an weight of 9.64 per cent of loans taken out by SMEs to buy immovable goods, while export loans only represent 0.07 per cent of the total. Although the SMEs funding is 63 per cent of total corporate loans, only 14 per cent of the SMEs have taken out bank loans. The BNR official indicated that the Basel II Capital Accord would be implemented as from January 1, 2008, under which the SMEs assigned risk in a bank’s portfolio will drop. The Basel II Agreement contains an improved risk management methodology that will lead to lower capital requirements to be met by the banks’ lending portfolio. At the end of October 2007, the corporate credit was standing at almost RON 70 bln, of which loans in foreign currencies accounted fro over RON 37 bln.


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