Romania’s tax agency starts fiscal inspections at three banks over losses

The tax administration agency ANAF has initiated fiscal controls at three banks as part of a wider investigation into the losses posted by the banking system.

The news came days after PM Mihai Tudose said that some banks were externalizing profits from Romania, while Ionut Misa, the minister of finance, claimed that the sale of non-performing loans with big discounts was used by banks as a tax avoidance method.

“At 31.12.2016, there were 31 banking institutions out of 46 that recorded losses. The causes that led to the fiscal losses will be identified during fiscal inspections carried out at this banks,” said the Ministry of Finance in a statement submitted to news portal bancherul.ro.

The main banking associations in Romania said in a joint statement last week that the lenders posted losses due to the financial crisis.

“Aside from the effects of the crisis, the reduced profits in the banking system were caused by efforts to reduce the credit risk by covering the non-performing loans with provisions, of reducing the interests and of changing of the computation mechanism through the conversion to international financial reporting standards (IFRS) starting 2012,” said the Association of Romanian Banks (ARB) and the Council of Banking Employers in Romania (CPBR).