* Analysts: It will be hard for Romania to raise funding
The possibility of Greece, France and Italy limiting lending to their subsidiaries of Eastern Europe, as mentioned in a report by financial agency "Moody's", is a purely intellectual speculation game, because those countries did not officially announce that, said Lucian Croitoru, advisor to the Governor of the NBR.
He added, however, that if it were to come to that, the process could not be achieved in the short term, it could only be achieved in the longer run. Moreover, the restrictions of lending to the subsidiaries would not only affect Central and Eastern Europe, but the Eurozone as well, because the parent banks would be affected themselves, according to Lucian Croitoru.
Also, the possibility of parent banks stopping financing to their subsidiaries in this region does not imply maintaining the exposure to countries in Eastern Europe, which was announced on November 3rd-4th, the advisor to the Governor of the NBR said. He added that it was worth watching why the restriction of the parent banks is limited to the deposits of subsidiaries and does not include capital.
Austria's announcement that it would place restrictions on its banks when it comes to lending to their subsidiaries in Eastern Europe could be followed by other countries such as Greece, France and Italy, which will support their orientation towards lending in the local currency, with the quickest change being expected to occur in Hungary, Romania and Bulgaria, according to a report by "Moody's".
"We expect banks in Hungary, Romania and Bulgaria to require the quickest change in the business models, because they are far more reliant on financing in foreign currency from their parent banks. Moody's predicts that the new regulations could increase competition for deposits in foreign currencies in the aforementioned c
