Greek-held Alpha Bank and Banca Romaneasca (local subsidiary of the National Bank of Greece) were the first two banks to react to the signal sent on Tuesday by the NBR (National Bank of Romania) when it cut its key interest rate to 7% a year, by lowering interest rates on deposits, as well as on loans in RON.
Volksbank also reduced its interest rates to 9.5% on one-month deposits, and to 7.75% on three and six-month deposits. Greece's Piraeus Bank also cut interest rates, with Millennium remaining the only bank to offer a two-digit interest - 10% a year - on three-month deposits.
The market has been much more swift in its response to monetary policy signals than in the past. Bankers explain this swift adjustment by the anticipations created by the NBR that it will continue to cut its key rate, as well as by conditions on the monetary market, where interest rates fell towards 5% a year, with the National Bank making sure the supply of RON is always sufficient.
"Because signals given by the NBR are very clear as far as interests are concerned, rapid, large-scale responses are to be expected. Interest rates of over 9% on deposits are not justified on the market. With banks still paying 9% or even more on many of their basic products, the cut is expected to amount to around one percentage point," says Sorin Mititelu, in charge of Business development and retail products with the BCR.
Banca Romaneasca made a decisive move, by cutting its base rate on RON deposits by two percentage points, to 9.38% a year. This indicator is used in calculating the cost of secured and non-secured personal loans, with the bank adding margins of three to six percentage points. As a result, interest rates on consumer loans now amount to 12.38% a year (on secured loans) and 15.38% on non-secured ones.
Alpha Bank cut up to three quarters of a percentage point off in