BNR spokesman replies to Darius Valcov’s statements on ROBOR: There’s serious confusion in understanding the monetary market

National Bank spokesman Dan Suciu argues that the statements made by Darius Valcov, adviser to PM Viorica Dancila on economic issues, about the change in calculating the ROBOR index or scraping it, show serious confusion regarding the monetary market and its role in supplying liquidities to the economy, banks and treasury.

“The National Bank is in dialogue with the Finance Ministry and does not understand the position of Mr. Valcov in this discussion. Furthermore, he seems to have serious confusions in regard to the monetary market and about the supply with liquidities of the economy, banks and the Treasury. He seems to have the same confusions as Mr. Zamfir (ALDE Senator – our note). (…) The monetary market is working effective and such statements unfairly question it. As the 3-month ROBOR Index has come in the installments structure by GEO, I really don’t understand what should BNR do?” Dan Suciu said.

Darius Valcov, adviser on economic issues to PM Viorica Dancila, argued, in an interview for Blomberg on Monday, that he hopes for a change of the formula used to calculate the so-called ROBOR interbank rate or scrap it all together.

“I hope we can get a radical change in the way ROBOR is calculated or even see its demise,” Valcov said in a phone interview Monday. “A decision will be made with the central bank, which can modify internal rules on the market rates without requiring parliamentary approval.”

“That will end a situation in which banks lend to one another at unjustifiably low costs,” he added.

The government is asking the central bank to help it effectively eliminate a so-called “greed tax” on banks that it pushed through despite warnings from policy makers and investors who drove the leu to a record-low, Bloomberg also informed.

The central bank and the Finance Ministry are now engaged in a debate over how to alleviate the pressure that the new tax is generating on banks, with rate-setters urging the cabinet to drop the link between the tax and the ROBOR. Valcov suggested that the central bank can work with lenders and the government to push the ROBOR to below 2 percent, a level at which the tax is zero.

“We don’t care about the level of the tax or any extra revenue,” Valcov said. “We want the borrowing costs for citizens to be close to those of the other Europeans, to be cut in half from the current levels.”

BNR and the Finance Ministry are conducting talks on the ways to ease the pressure of the ‘greed tax’ on banks, with the National Bank asking the Government to give up the connection between the tax and ROBOR.

 

Darius ValcovFinance ministrygovernmentmonetary marketNational BankROBOR indexspokesman Dan Suciuviorica dancila
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