Gov’t, National Bank and banks must reach consensus on ROBOR, argues PM advisor Valcov
Feb 11, 2019
Gov’t, National Bank and banks must reach consensus on ROBOR, argues PM advisor Valcov.
Darius Valcov, advisor to the Prime Minister, told a televised broadcast on Sunday evening that changing the interbank offered rate ROBOR is out of question, but the government, the National Bank and the banks must reach a consensus in this regard.
"This is not about changing the ROBOR or arithmetic, we need to reach a consensus with the National Bank, and it would be desirable to reach common ground with the banks too, since I think the people already agree that interest rates are very high. Reaching this three-way consensus is a must. National Bank experts have told us the ROBOR is linked to inflation, but they are telling people this only now, in 2019, when inflation is 3.3 pct, so the ROBOR too should be 3 percent .When inflation was negative, when we had deflation, why have all the European central banks considered fit cutting the [key interest] rate, whereas the National Bank did not move to this effect, yet in the case of the opposite trend the National Bank did not intervene," Valcov told private broadcaster Antena 3.
He added that in 2015 - 2016, when the European Bank "poured" money into the market and all other national banks reduced their key policy rate, the National Bank "kept the key rate the highest, at 1.75 percent," so that the gap, the difference between interest on credit and deposit interest remained the largest in the EU.
"This difference virtually generates gains for the banking system. In Romania, the banks’ gains are the highest in the EU, three times the average and seven times higher than in Germany," Valcov argued.
Referring to the upcoming hearing of BNR governor Mugur Isarescu in the Parliament expert committees, Valcov said the country’s top banker should prepare his answers well. AGERPRES (RO - editor: Sorin Penes, editor: Marius Fratila; EN - author: Simona Klodnischi, editor: Simona Iacob)
[Read the article in Agerpres]