Daily Newsletter - 5 January 2021


Macroeconomic News (4)

Brexit effect on Romania's foreign trade

In recent years, the United Kingdom has been Romania's most important foreign trade partner, especially since Romania managed to reach a significant trade surplus with the UK. The island economy's decision to leave the trading area and to establish trade barriers will affect Romania's trade balance. In 2019, the last year for which there are certified final data, Great Britain was Romania's fifth largest export partner (3.7% of the total), behind Germany (22.4%), Italy (11.3%), France (6.9%) and Hungary (4.8%).


New car registrations in Romania up slightly in December

The official data regarding the registrations of new vehicles in Romania indicate a 24.18% expansion of the automotive market in the last month of the year, which helped to offset somewhat the annual contraction. Car sales reached a record figure for 2020. New car purchases reached a total of 15,974 units in December, up 16%.


MFP borrowed more than RON 1 billion

The Ministry of Finance borrowed RON 1.01 billion from the commercial banks yesterday, through an issue of benchmark government bonds with a residual maturity of 47 months, at an average yield of 2.60% per year, according to data released by the National Bank of Romania (BNR). The target value of Monday's issue was RON 700 million, with banks offering a total of RON 1.254 billion.


HORA urges swift reopening of restaurants

The Employers' Organization of Hotels and Restaurants in Romania (HORA) has urged the Cabinet to urgently allow restaurants to reopen their indoor areas, provided that all health safety measures are observed. The organization also urged the authorities to exempt restaurants from lockdowns when local spread rates exceed 3 per 1,000, based on an industry-wide set of safety measures.


Financial News (4)

CEC Bank in compliance with PSD2

Beginning with the first day of the year, CEC Bank implemented new methods for confirming online card payments, in accordance with the revised European Payments Directive (PSD2), in order to reduce e-commerce fraud by adding a customer protection filter when making online payments. All of the bank's clients will be able to use biometric authentication through the Mobile Banking application or confirm transactions using two passwords, a dynamic one sent via text message, and a static one.


Retail loan interest rates to fall

The Consumer Credit Reference Index (IRCC) comes with a significant reduction in the first quarter of 2021 and is set to fall in the second quarter as well. For the first time in the last year, IRCC is declining faster than ROBOR. The new value of the IRCC, valid for the period January-March 2021, is 1.88%, down from 2.17% in the fourth quarter of 2020.


BNR foreign currency reserves up EUR 4 billion

The foreign exchange reserves managed by the National Bank of Romania (BNR) increased by RON 3,9 billion (over 11.9%) in December, 2020, compared to November, reaching EUR 37.37 billion, according to a BNR report issued on Monday. The most significant inflows served to replenish the accounts of the Ministry of Finance, including the amounts resulting from the Eurobond issues sold by the Ministry of Finance on the foreign market, amounting to EUR 2.5 billion, as well as the loan from the European Commission obtained through the SURE program, worth EUR 3.03 billion.


Vista Bank buys Credit Agricole Romania

Vista Bank announced that it has signed an agreement with French financial group Credit Agricole for the acquisition of Credit Agricole Romania. The acquisition requires the approval of the National Bank of Romania (BNR) and the Competition Council. Upon completing the acquisition, Vista Bank will hold total assets of over EUR 1.2 billion, EUR 750 million worth of loans, EUR 1.1 billion in deposits, and over EUR 105 million of CET1 capital.


Investment News (1)

Oradea Tech Hub launched start-up accelerator program

Oradea Tech Hub, a hub dedicated to technology start-ups based in the northwestern part of the country, launched a pre-acceleration program called Make IT in Oradea at the end of last year. The program has an annual budget of EUR 300,000, 80% of which will go to finance projects that have the potential to turn into businesses. The funding came from the Oradea City Hall.


Legislative News (1)

President signs Romania-IBRD loan bill

On Monday, President Klaus Iohannis signed the bill ratifying the Loan Agreement (Result-based Program in the Romanian Healthcare Sector) between Romania and the International Bank for Reconstruction and Development (IBRD). The loan is worth EUR 500 million.


Politics (2)

Ciolacu: The right-wing government is mocking 5 million pensioners

"In the first week of government, the new power has already pulled five huge scams! After the election, all promises became aggression! The right-wing government is mocking 5 million pensioners. Last year, PNL was offering a 14% increase in pensions before the election and promised of up to 40% more in 2021. Citu's reality is that pensions will not increase until September, by a tiny percentage, which does not cover the price increases for food, medicine and utilities. They lied to you, they tricked you," wrote PSD leader Marcel Ciolacu on Monday.


Raluca Turcan: Marcel Ciolacu is trying to manipulate the pensioners

Raluca Turcan accused Marcel Ciolacu of trying to manipulate pensioners again by spreading lies about the measures adopted by the Cabinet. The Minister of Labor reminded the PSD leader that the biggest increase of the pension point was made by the PNL cabinet during a crisis.


Social (2)

School reopening not dependent on vaccination

Doctor Valeriu Gheorghita, coordinator of the vaccination campaign against COVID-19, announced that the reopening of schools is not conditioned by the vaccination of teachers. Gheorghita added that teachers are essential workers and have priority access to vaccination.


Four out of ten Romanians manage to save

During the pandemic, about four out of ten Romanians manage to save money (39%), down from two thirds (68%) before the pandemic, according to a study conducted in December by the Romanian Institute for Evaluation and Strategy (IRES) and commissioned by the Romanian Banking Association (ARB).