Consumer lending continued to expand at a fast pace in April, mainly fuelled, as seen in previous months, by the financing in RON.
Consumer lending in April grew by 7.1%, slightly slower than in March, getting to 19.66 billion RON (5.6 billion euros).
Under the circumstances, annualised growth sped up to 112% in nominal terms, two percentage points above the level in March.
In real terms, lending saw an annualised growth rate of almost 106%. This was the fourth month in a row when the growth pace accelerated.
Financing in RON accounted for the greatest volume of loans granted in April.
Its amount surged by 8.7%, the fastest pace since last May, to 14.3 billion RON (4.1 billion euros). The sustained growth pushed the annual expansion pace to a new record high, 139% in nominal terms and over 132% in real terms.
A year ago, the annual increase was a little above 20%, but during this interval it has constantly gathered speed.
In April, loans in foreign currency witnessed more modest growth, with their amount advancing by 3%, to 5.3 billion RON (1.5 billion euros).
In March, the increase had stood at 7.4%. In absolute volumes, April brought an increase by over one billion RON for RON-denominated loans.
Loans in foreign currency increased by merely 166 million RON. Consumer lending in domestic currency has significantly increased in volume to almost 73%, up from the level of 64% a year ago.
The central bank is increasingly concerned about the rapid expansion of RON lending.
The bank has recently stated it might make some moves to moderate lending in domestic currency should the pace of growth become unsustainable.
On the other hand, the central bank has not modified the monetary policy interest rate since February, when it operated a one-percentage point raise, to 8.5%.
Chances that the bank should operate a new raise are becoming smaller, with the market even expecting a decrease, predicted to occur towards yearend.
As a result the central bank can either increase compulsory minimal reserves, which have already reached very high levels, or introduce new administrative measures.
Even though bankers, including central bank officials, had said that 2006 would be the year of mortgages, consumption has so far registered a much more considerable increase.
As a matter of fact, offers meant to promote these loans were extended, practically covering the entire period between Christmas and Easter.
Banks have tried to lure customers both with the "traditional" interest rate cuts, as well as by trimming the required documentation and cutting down the time interval it takes for customers to get a response.
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