BUCHAREST, Aug 29 (Reuters) - Deleveraging by big European banking groups from their Romanian units will likely continue to rise, the head of the central bank’s supervisory department was quoted as saying on Thursday.
“In the last year and a half, 25 percent of the balance of resources received from mother banks at the level of 2011 have left ... that means 5 billion euros,” Nicolae Cinteza was quoted as saying by daily Ziarul Financiar.
“I do not have a problem with deleveraging itself. The problem is non-performing (loans) keep growing and there is a danger that they will be funded from the local market.”
Non-performing loans were at roughly 20 percent.
Cinteza also said the central bank was carefully monitoring the amount of provisioning for bad loans and that if the level is reduced the bank may even prohibit commercial banks from attrracting local funding. (Reporting by Luiza Ilie)