Dealers: "Interbank Interest Rates Do Not Reflect Market Status"

The interest rates on the monetary market remain around 14% bid and 18% offered for one-day loans, dealers inform. In both cases, the rates are above the National Bank"s key interest rate of 10.25% as the demand for liquidity remains quite high.Dealers believe that the interbank rates on display do not reflect the situation on the market as banks remain startled by the National Bank"s approach. Specifically, the central bank demanded explanations from the banks with very high rates (over 90% for one-day arrangements), despite their option to obtain liquidity from the central bank through Lombard credit with an interest of 14.25% in exchange for Treasury bills. Dealers say that there are banks which use the Lombard option offered by the central bank, but this is only applicable to banks that hold T-bills. Others are forced to accept the high interest rates on the market. It appears that the new central bank regulations have not been applied yet, considering that the interest rates exceed the 25% margin between the credit facility offered by the central bank and the market interest rates. According to the new regulations, if the ROBOR (Romanian Interbank Offered Rate) exceeds the interest on the credit facility of the central bank by more than 25%, the central bank can temporarily suspend the publication of the ROBID / ROBOR indexes, which are calculated based on the quotations of the participating banks. If so, the indexes will be published at the level of the rate for the central bank"s credit facility, which is 6.25% bid and 14.25% offered.