Romanians’ loan delinquencies hit 2.865 billion lei (719 million euro) at the end of 2008, up2.6-fold from December 2007, with the share of loan defaults in the total volume of granted loans growing to nearly 50%. Debt collection agencies polled by Wall-Street announce tough times for cash collection proceedings.
If in December 2007, the loan delinquencies accounted for 1.092 billion lei, at the end of last year, Romanians’ loan delinquencies rose to 2.865 billion lei (719 million euro).
However, the outstanding loan rate in total loan volume reached 1.44% at the end of 2008, compared to 0.73% in December 31 2007.
Companies and residents of Bucharest had the biggest defaults, worth 823.09 million lei according to National Bank of Romania, slightly lower than end-November, when it equated 858.33 million lei.
Nevertheless, companies and inhabitants of Bucharest contracted the biggest share of the loans that reached roughly 70.17 billion lei in end-December, with two thirds in foreign currency.
After Bucharest, the biggest loan defaults were registered in Brasov, of 133.87 million lei, followed by Timis with 130.13 million lei. On fourth position is Bihor, with 97.8 million lei loan delinquency, followed by Cluj – 96.5 million lei.
“In the last months of 2008, we’ve noticed a troublesome payment behavior of the legal persons. Many of them no longer have the possibility of paying debts as their activities were severely afflicted by the financial crisis”, Georg Kovacs, managing director of EOS KSI Romania told Wall-Street.
Coface’s debt collection department notes the worrying payment behavior among active Romanian companies.
“If before the crisis, the payment behavior was normal, the debtors still managing to pay their loan-rates after 60 days, now in the midst of economic downturn, the loan delinquency rates can reach up t
