Bank fraud case is overblown, says Isarescu

Newsroom 06/11/2012 | 09:17

Romania’s central bank governor Mugur Isarescu on Friday stated the 16 banking units involved in the EUR 22 million fraud case accounted for just 0.8 percent of the banking system, not 80 percent as it was stated by DIICOT prosecutors.

The Romanian Banking Association (ARB) today said the fraud hit 0.28 percent of the banking system, which is made out of 5,688 units. The fraud is valued at EUR 22 million, which is roughly 0.043 percent of the total loan book of EUR 51 billion

“We are not talking about a banking crime network (octopus) (…) This is rather a crime group outside the banks and there are 16 banking units involved not 3 banks,” said Isarescu quoted by Agerpres newswire.

The central bank’s supervision aims to protect deponents if banks make lending mistakes, in the same time making sure that banks provisions the non-performing loans, according to Isarescu,

“The banking supervision doesn’t grant loans, doesn’t supervise loans piece by piece neither the fraud, it’s not the supervision job. It would be nonsense for 40 banks to be set up and the central banks to have all the responsibility,” said Isarescu.

The ARB stated that bank representatives provided information during the investigation.

“The banking community maintains transparency and unconditional support for finalizing the investigation, as it wants a quick clarification of this case, whose size shouldn’t worry bank customers, either deponents or loan beneficiaries,” stated the ARB.