According to the BNR official, FDI companies have higher interest on loans from parents

The local branches of foreign groups are paying a lot of interest on loans of about EUR 10 million contracted with their financial departments, said Florian Neagu, deputy director at the Directorate of finance stability from the National Bank of Romania (BNR).

Interest rates paid to parent institutions are higher compared to those paid to domestic banks. Transfer pricing or poor governance in local banks cannot attract FDI firms as customers, BNR officials concluded. .

“It raises some questions. Maybe it’s a problem of transfer prices, or the quality of Romanian bank services needs to be improved”, he said, according to

The total amount of loans, about EUR 10 billion, represents significant figures compared to the national financial situation (some EUR 40 billion worth of government loans extended to non-banking companies and institutions).

“This cost is worth investigating because there is so much at stake,” Neagu said.

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