Central Bank lends RON 4 bln to 17 banks
The National Bank of Romania (BNR) lent RON 4 bln to 17 banks trough a repo operation conducted Monday, in which demand was six times higher, reaching RON 24.9 bln, reads a press release. The Central Bank capped yesterday, for the sixth week in a row, at RON 4 bln the sum available in the repo auction, and this was also the 14th week when the bank limits the available sum. Last week, BNR extend loans worth RON 4 bln in total to 13 banks, and the sums auctioned by crediting institutions reached RON 17.48 bln in total.
Through repo auctions, BNR offers cash to commercial banks in exchange of state bonds, at the key interest of 5.25 pc a year. The loans are extended for 1-week intervals. BNR governor Mugur Isarescu last year said that limiting the repo auctions conducted by the Central Bank is a faster and more effective method of action than modifying the key interest rate, with a stronger impact on the exchange rate. In its turn, the Finance Ministry on Monday attracted RON 2.14 bln in one-year certificates and two-year debentures, at declining yields, amid growing demand.
Via one-year certificates, Treasury borrowed RON 1.08 bln, at an yield of 6.06 pc, down from 6.24 pc paid at the latest such auction in 2012. The indicative value of the operation came to RON 500 M, and demand rose to RON 1.7 bln
Source: Nine O'clock