Last year, Romanian banks granted new loans to the population and companies in the amount of 140 billion lei, an increase of 10.41% compared to the volume of new loans accessed in 2022. The volume of new loans accessed by the population and companies, last year, represents the equivalent of 36% of the balance of non-governmental credit related to December 2023.
The balance of non-governmental credit, which totaled 387 billion lei at the end of last year, is calculated as the difference between the total of new credits granted to the population and companies and the partial and total repayments, as well as the sales of credits.
The speed of credit renewal is accelerated by the boost in the financing of companies, in a volume of 77.3 billion lei, a significant share of which accesses short-term loans, under one year. The breakdown by currency reveals that last year 74.56% of loans were granted in the national currency, 22.44% in euros and 3% in dollars, which shows confidence in the national currency and contributes to the reduction of currency risk.
The volume of new loans granted by credit institutions in Romania, between January 2020 and December 2023, marked by the coronavirus pandemic and the effects of the war in Ukraine, amounts to 461 billion lei. The new credits, granted in the four years, exceed by more than 19% the non-governmental credit balance recorded at the end of December 2023 and represent the equivalent of one third of Romania’s Gross Domestic Product. The statistics confirm the appetite for non-governmental loans and the increasing support of Romanian banks for the population and companies, although the speed of credit growth at the balance level has been more moderate in recent years.
The banking system is part of the solution to the overlapping crises, providing funding at a sustained pace and on a sustainable basis, saving at competitive interest rates compared to other states and digital products and services. Banks help finance businesses, investment projects and housing for 2.3 million borrowers, thereby stimulating economic growth and job creation.
The banking sector facilitates savings, at competitive interest rates, to achieve customers’ long-term financial goals. Thus, 15.89 million individual and legal depositors hold deposits amounting to almost 574 billion lei in December 2023, increasing by 11.8% at an annual rate. Banks are strictly regulated, ensuring the safety of customer deposits and the stability of the financial system.
Credit institutions are investing billions of lei in technology and innovation, the offer of online products and services experiencing a significant increase since the beginning of the pandemic, from the perspective of efficiency and accessibility. Banks remain concerned with intensifying digitization with ensuring cyber security to streamline costs and increase customer satisfaction.
Despite the good results, the profitability of the banking industry remained below the profitability rate of non-financial companies in 2023, continuing the evolution of the last decade. The results recorded last year regarding profitability are due to the credit advance, the reversal of some provisions made during the pandemic years and the increased efficiency against the background of the intensification of digitization. At the national level, more than 60% of the profits obtained by banks were capitalized, which increases the capacity of credit institutions to finance the needs of companies, the population and the state.
In 2022, the banking sector was at the bottom of the profitability ranking of economic sectors in Romania. The banking industry was ranked 20 out of 24 in the top economic sectors in terms of return on capital and 24 out of 24 in terms of return on assets.
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