Romanian President Basescu: possible capital flow cuts by Austrian banks not fair play

Newsroom 24/11/2011 | 13:50

The announcement made by the Austrian Central Bank on the reduction of capital flows to non-euro area countries “was an error or a misunderstanding of the consequences this would have,” said President Traian Basescu this Thursday expressing concerns about possible capital flow cuts to Romania.

It would be a “lack of fair play” if banks from EU member states should decide to cut financing to Romania during a crisis period after making “huge profits” locally a few years ago, added the president.

His reaction comes after the Austrian Central Bank has announced on Monday that it will ask players like UniCredit Bank Austria, Erste Group and Raiffeisen Bank International – all three banks running operations in Romania – to cut financing in Eastern European states.

Future credits must be conditioned by attracting loans through the banks’ local subsidiaries or from institutions like the European Bank for Development and Reconstruction (BERD) or the European Investment Bank, have announced representatives of the Austrian Central Bank.

Simona Bazavan

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