Post on 22-Dec-2015
Developments
Current account deficit:
2005: EUR 6.9 bn. (8.7% of GDP); 75.6% covered by FDI;2006 estimate: EUR 10% of GDP
Fiscal balance: 2005: 0.8% of GDP2006 estimate: 1% of GDP
FOREIGN INVESTMENTS IN ROMANIA (billion EUR)
1.14
1.29
1.12
1.62
3.3
5.2
9
0 1 2 3 4 5 6 7 8 9 10
2000
2001
2002
2003
2004
2005
2006*
Developments in 2005 - 2006
International reserves at a record level (FCY including gold):
2005: EUR 18.3 bn.; forex reserves EUR 16.8 bn. 2006: EUR 22.9 bn.; forex reserves EUR 21.3 bn.
Rating agencies upgraded Romania’s rating:
Fitch upgraded Romania’s foreign currency rating from BBB- to BBB with stable outlook on August 31, 2006Moody's upgraded Romania’s rating for short and long term borrowings both in FCY and in lei at Baa3/P-3, with stable outlook, in October 2006
Public debt was 20.1% of GDP in 2005 (domestic debt: 5.6% of GDP;
external debt: 14.4% of GDP)
Source: NBR, NIS
EUR billion
EUR billion
*) November 2006
Banking System in Romania
Weight of non-governmental loans in GDP (%)
17.5%22%
27%
88%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
90.00%
100.00%
2004 2005 2006* UE
Market shares in the banking system/Total Assets (%)
87.9%
5.3% 6.8%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Banks with foreigncapital
Banks with local statecapital
Banks with local privatecapital
Source: NBR
Banking Sector in Romania (2006)
Features:
37 banks (of which 6 foreign bank branches)
61% of banking assets held by top five banks
Solvency ratio: 17.9%
Evolution of banking assets in Romania (bn. EUR)
15.3122.67
37.70
51
0
10
20
30
40
50
60
2003 2004 2005 2006
Source: NBR
Banking Sector Concentration (Top 5 commercial banks)
December 2005 RON billion EUR billion % of total banking system
Assets 75.4 20.5 58.8
Loans 37.0 10.1 61.2
Deposits 52.4 14.3 57.0
Own capital 8.9 2.4 55.1
September 2006Assets 92.5 26.2 61.1
Loans 54.6 15.5 64.5
Deposits 61.5 17.4 58.8
Own capital 10.6 3.0 54.4Source: NBR
Conclusions• The evolution of macroeconomic ratios show a
positive outlook and an upward trend of the whole economy; Romania successfully achieved the targets set for its accession to UE marking an important turnaround point for its future development;
• Competition sharpened, especially in the banking system, but there is still place for growth, considering the low banking penetration in GDP; new important international players announced their intentions to step in;