Update: 3-month ROBOR Index slightly up to 3.07%. Darius Valcov hopes for change in calculating the index

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The 3-month ROBOR Index, according to which the cost of variable-yield loans in RON is calculated, has increased on Monday to 3.07%, up against 3.06% in the previous session, according to the figures released by the National Bank of Romania (BNR).

Early this year the index was 2.99% per annum.

The 6-month ROBOR Index, considered in order to calculate interest rates on mortgage loans, has decreased to 3.30%, up from 3.29% on Friday.

The 9-month ROBOR Index, representing the interest rate paid for the loans in RON attracted by the commercial banks from other commercial banks for a nine months period, has increased to 3.43%, up from 3.42%.

The 12-month ROBOR Index has increased to 3.49%, up from 3.48% in the previous session.

ROBOR (Romanian Interbank Offer Rate) is the average interest rate for loans in national currency granted on the interbank market, and the increase of this indicator will lead to an increase of instalments for loans in national currency.

Gov’t urges central bank to re-define ROBOR, Darius Valcov says

Darius Valcov, adviser on economic issues to PM Viorica Dancila, argues, 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 informs.

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.”

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