Bankers make loans more expensive for second month in a row

New loans became more expensive in July, both RON andeuro-denominated ones, for the second consecutive month, althoughbankers are complaining of a lack of customers for loans.
The banking market recorded an annual percentage rate of 18.8% onRON consumer loans in July, up by one percentage point againstJune, show data of the NBR (National Bank of Romania). Even securedloans became more difficult to obtain, with the annual percentagerate on new mortgage loans up by 1.6%, to 7.29%.
"Banks may have reacted 'mechanically' to the inflation rise and,forced to boost deposit interest rates, they also boosted the costof loans in order to preserve the interest rate spread," saysLaurian Lungu, managing partner at Macroanalitica research company.
Several banks returned to interests above 8% a year on RON depositsin July, after inflation exceeded 7% and after the introduction ofthe tax on interest incomes. But whilst the nominal interest rateon new RON-denominated loans for individuals went up by 0.44%, theaverage increase on deposit interest rates was half as much.