|
EBRD, BCR help strengthen Romanian mortgage market
Thousands to benefit with more access to finance from €50 million loan
Romania’s mortgage market is set to expand and become more competitive
following a €50 million loan from the EBRD to Banca Comerciala Romana (BCR),
the country’s largest bank.
BCR will use the loan to on-lend up to the equivalent of €100,000, or more on
a case-by-case basis, to new or existing clients wishing to buy, build or
renovate their homes. Thousands of people are expected to benefit. Under a
similar loan to BCR in 2003, more than 6,000 clients received mortgages from
the bank.
While Romania’s mortgage market has grown rapidly over recent years, the
sector is still significantly under-developed, accounting for less than 2 per
cent of the country’s gross domestic product. This compares to an average of
44 per cent in the European Union and 65 per cent in the United Kingdom.
There is clearly much more scope for developing the mortgage market in
Romania, said Hildegard Gacek, EBRD Director for Romania. The EBRD is working
with local banks like BCR to help many people across the country realise their
dreams of owning a home. Since the first similar mortgage loan to BCR in 2003,
the EBRD has lent six banks in Romania a total of around €120 million to
support this sector. By providing mortgage loans to many local institutions,
the EBRD is promoting competition in the sector, further benefiting
individuals and the economy, added Ms Gacek.
The loan builds on more than a decade of cooperation between the EBRD and BCR.
As well as supporting the mortgage sector, both banks have worked together to
help, for example, small and medium-sized enterprises and small and medium
municipalities gain access to more finance to develop their businesses or to
foster infrastructure programmes.
Established in 1990, BCR has over 340 branches and units in virtually in all
Romanian towns and cities. The mortgage market is a key development for BCR as
undisputable leader of the market said Nicolae Danila, BCR’s Chief Executive
Officer. BCR will continue to focus on the Romanian primary mortgage market
and will take the necessary steps to enter the secondary mortgage market in
due time. The co-operation with the EBRD in this respect is very important, he
added.
The EBRD is the largest investor in Romania having committed almost €2.6
billion in 131 projects.
|
