The decision was made in order to allow governments to help banks in a context marked by difficult access to loans, capital deficit and the sovereign debt crisis. However, the banks whose main activity is based on the transaction of state bonds will still have to prove to the EU that they can stay afloat. Recently, the US rating agency Standard & Poor’s downgraded several tens of banks following the application of a new evaluation criterion, namely the possibility of receiving financial support from a government or a foreign group.

15 countries in the Eurozone, including Germany and France, have been warned that their credit ratings could be downgraded. How is Romania affected by this situation? Lucian Croitoru, an adviser to the National Bank governor, believes that Romania is still dependent on foreign capital injections, even though it has a sound economic base. He said that Romania would be affected by any worsening of the situation in the Eurozone, especially in terms of exports and the exchange rate, considering that domestic consumption shows no signs of recovery.

Another reason to worry is the fear that the Romanian branches of foreign banks might withdraw excess funds and move them abroad. Here is Lucian Croitoru:

“There are consequences to the repatriation of funds, even if we are talking about small amounts. Because we are talking about the Euro, this will mainly affect corporate investments. Of course banks can repatriate more easily funds that have reached maturity and have been invested in state bonds, which in the future may create problems in terms of financing the government”.

Croitoru added that loan costs would remain relatively high for quite a long time. He said that in the near future loaning costs would rise, and that banks tend to transfer these costs to consumers, which means that costs for loans in Romania will rise at least until June next year.