Financial Stability Report No.14 (2)/2017
Liviu Voinea, Deputy Governor
Press conference, Bucharest, 4 December 2017
Your Excellences,
Dear colleagues,
Dear guests,
Thank you for your presence at the launch of the December 2017 issue of the Financial
Stability Report, No. 14(2)/2017. Right beside me are three NBR directors who are ready to
answer your questions: Mr Eugen Rădulescu, director of the Financial Stability Department,
which prepared the Report - I wish to thank all the colleagues involved; Mr Emil Vonvea,
director of the Bank Resolution Department - an area having the role to strengthen
confidence in the banking sector - the Report also includes a section dedicated to resolution
strategies; and Mr Tudor Grosu, director of the Macroeconomic Modelling and Forecasting
Department, as part of the analyses in the Report are based on scenarios and econometric
models to the development of which his department also contributed. I would like to thank
the other departments which cooperated in the preparation of the Report, particularly the
Economic Studies Department for the translation.
This is the 14th financial stability report launched by the National Bank of Romania. I would
like to point out that the Report we are releasing today has been discussed in two meetings
of the NBR Board and was unanimously approved by the NBR Board in its meeting of 27
November 2017.
The Report presents the risks to financial stability, in close correlation with domestic and
international economic developments. Financial stability is a public good which refers not
only to banks, but also to the economy as a whole. Financial stability is influenced by the
quality of the public policy mix.
Since the previous Report (May 2017), financial stability has remained robust, yet we notice
that certain vulnerabilities are still manifest or have been building up, especially with regard
to upward pressures on the risk premium for emerging economies, tensions surrounding
domestic macroeconomic equilibria stemming from slippages and uncertainty in the
budgetary and fiscal policy and higher household indebtedness, the risks being compounded
by the correlation between these factors.
Looking at macroeconomic fundamentals, several favourable indicators are noteworthy:
 Romania's major advantage is the low public debt stock (37.4 percent of GDP),
together with the drop in the refinancing risk, due mainly to the extension in the
maturity of public debt (Figures 1 and 2). Public debt spans mostly the medium or
long term (94 percent of total, on the domestic and external markets alike - with
domestic debt accounting for 48 percent of total or 17 percent of GDP) (Figure 3).

Another advantage for Romania consists in the sizeable international reserves
(Figure 4). Yet, international reserves play a preventive role and they cannot make
up for the structural worsening of some indicators.
 The Romanian economy posted a high growth rate in the first nine months of 2017
(7 percent in the first three quarters of 2017 versus the same year-earlier period)
(Figure 5).
 Unemployment rate stayed on a downward track and employment rate was stuck
to the uptrend (Figure 6).
Nevertheless, these developments should be read considering the widening of the structural
government deficit and the increase in the trade deficit, whereas inflation rate returned
quickly into the upper half of the variation band of the target and the exchange rate of the
leu against the euro depreciated slightly since the beginning of the year. At the same time,
the interbank market rate rose at an accelerated pace in September, and stabilised
thereafter, amid the pick-up in annual inflation rate and the consolidation in expectations of
an adjustment in the monetary policy stance, coupled with the decline in the structural
liquidity surplus under the simultaneous influence of the main autonomous liquidity factors,
namely operations in the Treasury account and non-residents' transactions on the local
financial market.
As for the banking sector, key financial and prudential indicators have further posted a
robust performance. In the assessment conducted by the EBA, the indicators are in the
lowrisk bucket in terms of capitalisation, coverage by provisions, profitability, and balance sheet
structure; in the medium-risk bucket in terms of asset quality and operational efficiency;
and in the high-risk bucket as regards restructuring measures (Figure 8).
Solvency indicators continued to stand at adequate levels and the substantial capital
reserves relative to prudential requirements provide a good capacity to absorb unexpected
losses and resources to ensure lending to the real sector (Figure 10). Stress test results for
the banking sector reveal the resilience of the sector as a whole in case adverse
macroeconomic scenarios materialise, yet the impact of the interest rate risk on the banking
sector is notable, owing to the balance sheet structure featuring longer asset duration. The
analysis of interest rate-sensitive assets and liabilities shows a potential loss of 13.69
percent of own funds, assuming a standardised/uniform shock of 200 basis points on the
term structure of interest rates (the analysis takes into account a parallel upward shift in the
yield curve). The impact would result, ceteris paribus, in a potential decline in total capital
ratio at system level by up to 2.6 percentage points (Figure 10).
Liquidity ratios for the banking sector continue to post, on average, significantly higher
levels than the minimum requirement. The average liquidity coverage ratio (LCR) at
aggregate level is 239 percent (September 2017), standing above the EU-wide average of
145.6 percent (June 2017). The LCR ratio (Figure 11) confirms that the Romanian banking
sector holds a stock of quality liquid assets adequate to withstand a stress scenario for a
30day period. However, the immediate liquidity ratio calculated as the ratio of cash and bank
deposits at net value and unpledged government securities to total liabilities - the minimum
prudent level being 30 percent - fell marginally to 38 percent.
Asset quality indicators improved (the non-performing loan ratio dropped below 8 percent,
thereby entering the EBA-defined intermediate bucket), Romania posting the fastest
adjustment pace of NPL ratio in the past three years (Figure 13). The NPL decline occurred
for all categories of debtors and the NPL coverage by provisions has remained adequate
(Figure 14). Looking at the asset structure, loans to the real sector have risen slightly.
Turning to the liability structure, the banking sector has further seen an uptrend in
household deposits, counterbalancing the drop in foreign liabilities, which is likely to
mitigate the contagion risk to external shocks (Figure 15).
Banking sector profitability has strengthened against the background of a favourable local
macroeconomic environment, the significant reduction in net impairment loss on financial
assets, the protracted low level of funding costs, and of the recovery in leu-denominated
lending. Operational efficiency is in a better position compared to the EU-wide average, but
there is still room for improvement, especially for small- and medium-sized banks (Figure
16). The banking sector has continued to consolidate.
The entry into force of the new international financial reporting standards (IFRS 9) in 2018
implies both implementation costs and increases in impairment loss. For the credit
institutions in Romania, the impact would be low: (i) total capital ratio would decline by 24
basis points and the Tier 1 capital ratio would fall by 25 basis points; (ii) expected losses
would rise marginally against the current level of impairment loss (0.5 percent). The
portfolios for which the expected loss will be higher than current impairment loss are those
of loans granted to the retail segment and regional governments. Heterogeneity is higher
for banks at individual level, but is not likely to affect their stability considering the
substantial surplus in solvency indicators (Figure 17).
Starting with this issue of the Report, the NBR Board has decided to contain the number of
presented risks to five at most, for two reasons: the opportunity to focus the analysis and
draw attention to the most important messages, and the harmonisation with
international good practice of central banks that publish financial stability reports, the ECB
in particular. A full comparison with the risk map in the previous reports is therefore
unfeasible.
No severe systemic risk has been identified, but a combination of the identified risks may
induce a severe risk, amid unfavourable market conditions.
The main risks to financial stability are set out in the table below.
Map of risks to financial stability in Romania
Deterioration in investor sentiment in emerging economies
Tensions surrounding macroeconomic equilibria
Higher household indebtedness through both banks and NBFIs
Weak payment discipline in the economy, vulnerabilities in firms' balance sheets
Faster increase in property prices
severe systemic risk
high systemic risk
moderate systemic risk
low systemic risk
Note: The colour shows risk intensity. Arrows indicate the outlook for risk in the period ahead.
The risk of fast deterioration in investor sentiment in emerging economies is high, given
that the uncertainties about the strengthening of global economic growth and international
trade are still significant, amid the risks arising from economic and monetary policies, the
build-up of structural imbalances in the emerging economies and heightening geopolitical
tensions. An abrupt adjustment of the risk premium attached to emerging economies may
trigger sizeable negative consequences on the domestic environment.
This is, in fact, the credit risk, or the risk of an increase in interest rate, stemming from the
monetary policies of the advanced economies, the external uncertainties and the way the
market reacts to these. Against this background, credit risk refers to an increase in the
cost of foreign funding for both the Romanian government (Figures 19 and 20) and the
banking and corporate sectors.
It is noted that, in recent months, this risk has already started materialising. The Federal
Reserve initiated the monetary policy tightening cycle. The Bank of England decided to
increase the bank rate, which, in spite of keeping the real rate strongly negative, may act as
a signal - especially amid growing uncertainties about Brexit. In one of the peer economies
in the region, the Czech National Bank raised the policy rate twice - under special
circumstances, after exiting from the exchange rate commitment, and in the context of a
rising inflation. The European Central Bank decided to taper the asset purchase programme,
even though no date has been set as yet for ending this programme. Although at different
speeds and with notable exceptions (the Bank of Japan, for instance), it becomes
increasingly clear that the low interest rate era is drawing to a close. Emerging economies
are usually affected when interest rates go up in advanced economies and it is essential
that such episodes find them in good order domestically.
This is why the ongoing tensions surrounding macroeconomic equilibria in Romania since
the previous Report are a reason for concern. The chief driver of economic growth was
domestic consumption (Figure 21), while the external balance made a negative contribution
because of the widening deficit on trade in goods (Figure 22). Investment did not contribute
significantly to economic growth. Economic growth above potential is not always a cause for
concern, particularly when it takes place after a recession, for instance. Moreover, there are
a number of arguments that show that the economy's growth potential can be larger than
that calculated at present for both technical reasons (the time series are not long enough
and were influenced by the 2009-2010 recession) and fundamental reasons, which,
however, can be turned to good account only by structural adjustments. Thus, full
employment is a textbook requirement for fulfilling the economic growth potential:
important resources come, in this respect, from the almost 3 million Romanians working
abroad and circa 4 million inactive Romanians. Nor is the growth structure per se a systemic
risk, especially if part of the pick-up in domestic demand is accommodated by the rise in
domestic supply. Nevertheless, the developments in the twin deficits (the fiscal deficit and
the current account deficit) are a cause for concern, as they signal exactly the
abovepotential growth of economic activity at present, which may jeopardise medium-term
financial stability. The expansionary fiscal policy pursued starting with 2016, by applying
the 2015 Tax Code, has carried on in 2017, causing the fiscal space gained in 2010-2015 to
be exhausted (Figure 23). The current account deficit-to-GDP ratio, though well below its
pre-crisis levels, has posted divergent developments from those in the other EU emerging
economies (Figure 24). The structural deficit significantly exceeded the 1 percent
mediumterm objective in 2016 and is estimated to stand at 3.9 percent in 2017 (Figure 25). As a
matter of fact, the European Commission has included Romania into the Significant
Deviation Procedure from the medium-term objective.
When actual GDP growth exceeds potential growth, it is recommended to make savings
for fiscal consolidation reasons. Additional income from above-potential economic growth
allows for the financing of extra spending in the short run only. Yet, this expenditure is of a
permanent nature, while income is temporary, as it will decline, ceteris paribus, when the
economy returns to normal (potential) growth rates. Therefore, above-potential growth
conceals a structural deficit larger than the cash deficit. Today's structural deficit is,
however, the cash deficit of tomorrow which will need to be financed under circumstances
that may turn unfavourable for emerging economies.
This mix between an expansionary budgetary and fiscal policy during a period of
abovepotential economic growth and the worsening global market sentiment towards emerging
economies in general can enhance volatility and affect financial stability via several
channels: the interest rate, the exchange rate, the inflation rate.
The advance in household indebtedness can cause these risks to pass through from the
macroeconomic level to the microeconomic level for debtors. Last years' environment
marked by low interest rates and sustained increase in new loans favours the build-up of
possible vulnerabilities concerning the sustainability of the level of indebtedness through
both banks and NBFIs (Figure 26), especially for lower-income debtors. The fact that the
great majority of the stock and flow of housing loans and corporate loans are variable-rate
loans (Figure 27) is an aggravating factor for financial stability in the context of the start of
a new interest rate hike cycle - for external reasons, domestic reasons or for a combination
of reasons.
The fact that the advance in household indebtedness occurs concurrently with the high
economic growth rates indicates the problems of economic growth: it is unbalanced and it
leads to deeper inequality between social groups. Debt service-to-income ratio for debtors
earning minimum to average wage economy-wide stands higher than that for debtors
earning double the average wage, notably among borrowers with housing loans (Figure 28).
At the same time, the debt service for new loans taken by households earning minimum to
average wage economy-wide went up by 2 percentage points over the last 12 months.
Considering that almost 30 percent of the borrowers with housing loans earn minimum to
average wage economy-wide, a significant share of households report worrying
indebtedness levels in the event of unfavourable developments.
Moreover, the access to financing is much more reduced for individuals in the lower
quintiles: only 1 percent of the individuals in the first three quintiles took a housing loan
(Figure 29). The low interest rates and the granting of loans in lei improved access to
financing, but the upward trend in property prices offset these developments.
Housing loans show a higher sensitivity to consumer loans, to possible shocks on the
interest rate, the income or the exchange rate, given their maturity and the higher amounts
taken. In the context of the historically low interest rates seen at present, the main
mediumterm risk comes from the impact of future rises in the financing cost on the indebtedness
level. The DSTI ratio for housing loans would witness the largest increase in the event of a 2
percentage point interest rate hike (by 5.3 percentage points, Figure 30). By breakdown, the
interest rate shock would generate an approximately 10 percentage point advance in the
share of debtors with a DSTI ratio above 40 percent. Moreover, in June 2016-June 2017, the
median value of a new housing loan continued to rise, standing 5 percent above that of
outstanding housing exposures. This causes indebtedness to become more sensitive to
interest rate changes, amplifying debtors' vulnerability.
It is deemed that both the tensions surrounding macroeconomic equilibria and the
increase in household indebtedness are growing risks to the country's financial stability,
especially in the context of the changing global market sentiment towards emerging
economies, as reflected by the risk premium. These developments can be
counterbalanced by a stable and predictable domestic environment, but can also be
heightened by a state of uncertainty caused by major, insufficiently prepared and
explained changes in the public policy mix. Uncertainty delays investment and increases
the preference for liquidity - and the price for the preference for liquidity is the interest
rate. When the external environment is uncertainty-ridden and is facing a cycle reversal, it
is advisable that the domestic environment should not add to these uncertainties. The
pursuit of fulfilling economic policy priorities should not jeopardise financial stability,
which is a public good.
Another identified systemic risk is the weak payment discipline economy-wide, which
reflects in soft budget constraints in the private sector as well. This contributes to the
deepening of vulnerabilities that may affect financial stability through inefficient resource
allocation, the rise in non-performing loans, the distortion of market signals and the
creation of quasi-broad money with negative effects on inflation. The main risk factors to
financial stability are: (i) the undercapitalisation of a large number of companies (276.4
thousand firms with net worth below the required threshold, out of which 268.5 thousand
firms with negative equity), induced particularly by losses (217.3 thousand firms with total
losses of lei 33 billion in 2016), as well as the high indebtedness level in certain sectors, (ii)
the increase in past due obligations to the government budget (up 5.9 percent in 2016), (iii)
the low capacity to recover commercial claims, especially at the level of micro-enterprises,
(iv) corroborated by the large number of firms in credit institutions' portfolio which have not
gone through a full business cycle, (v) the return of insolvency to an upward trend in terms
of both the number of newly-insolvent firms (6.1 thousand firms in the first eight months of
the year) and the volume of non-performing loans generated in the banking sector (the
volume of non-performing loans generated by the companies undergoing insolvency
proceedings increased by about one third to lei 1 billion) and (vi) the rise in overdue
payments of the government budget to the real sector (up 9 percent in the period from
September 2016 to September 2017 to lei 223.1 million). In a broader perspective, the weak
payment discipline economy-wide has highlighted structural vulnerabilities in the balance
sheets of companies (Figures 31-34).
It is worth noting that the poor payment discipline economy-wide is not a new risk, but a
recurrent vulnerability in Romania's economy. It was deemed necessary to be emphasised
as a distinct risk that is on the rise on account of three reasons which make it more
dangerous today than previously: (i) the reduction in the vulnerabilities in banks' balance
sheets (through the clean-up of the non-performing loan portfolio) does not translate into a
corresponding decrease in the vulnerabilities in firms' balance sheets, which reveals the
persistence of structural issues economy-wide; (ii) the vulnerabilities in firms' balance
sheets have persisted even in an environment of above-potential economic growth; and
(iii) after the conclusion of the arrangement with the International Monetary Fund and the
European Union, part of the reforms carried out during the period covered by the
agreement with regard to strengthening payment discipline in the economy (cutting
arrears, in particular) were reversed.
In fact, the reversal of structural reforms seems to have started shortly after the
completion of the arrangement with the IMF and the EU, being manifest in the case of at
least two of the highlighted risks: the tensions surrounding macroeconomic equilibria (as
a result of giving up fiscal consolidation) and the weakening payment discipline in the
economy.
A risk of lower magnitude, yet related to the increase in household indebtedness, refers to
property prices. The faster increase in property prices further poses a risk to the banking
sector, as credit institutions' exposures to the real estate market are substantial. House
prices posted positive dynamics, albeit significantly slower than those seen in many EU
countries (Figures 35 and 36), on the back of higher household income, individuals'
improved expectations on their financial standing and of further extremely low interest
rates (Figure 37). Nevertheless, only a small part of real estate transactions are
loanfinanced. In the medium run, the potential risks that may arise from mortgage-backed
loans refer to the high interest rate sensitivity in the case of debtors having taken housing
loans (Figure 38).
The five risks summarised above are cyclical, being related to the developments in the
business and financial cycles. They can be amplified, in the future, by a potential
deceleration of GDP dynamics, which will also raise the issue of the next growth engine
(after the engine of domestic consumption slows down). The increase in financial
intermediation for the corporate sector could be this alternative driver, but only in the
context of improving payment discipline, lower uncertainties and a reversal to a positive
market sentiment.
These five cyclical risks are compounded by a fundamental, structural problem specific not
only to the economy, but also to the Romanian society, i.e. the demographic problem.
This is generated, on the one hand, by the natural decline in population, and, on the other
hand, by emigration. Although the GDP hit a 25-year high, Romania continues to see further
emigration and ageing population. The negative natural population growth has become
significantly more pronounced over the last years, Romania reporting one of the highest
values in the EU, while emigration is endemic. Furthermore, emigration also affects
highskilled professions, such as those in the healthcare sector. Thus, pressures emerge that
contribute to increasing tensions on macroeconomic equilibria and contain potential GDP
growth.
In order to mitigate risks to financial stability, the Report highlights a number of possible
measures to (i) reduce the risk of public debt refinancing, also with the help of measures to
further extend the maturity of debt instruments, (ii) align the structural deficit with the
medium-term objective, (iii) enhance debtors' capacity to withstand adverse developments,
(iv) ensure the better targeting of the "First Home" programme from a social perspective,
(v) recapitalise the companies with net worth below the required threshold and review the
market entry and exit conditions for firms, (vi) improve employment, lower the labour
underutilisation rate, also in what concerns regional disparities, and (vii) increase the
legislative framework predictability.
The National Bank of Romania monitors closely the evolution of risks to financial stability
and seeks to mitigate the risk of household overindebtedness through the
macroprudential policies it has adopted or prepares to adopt. Moreover, the NBR
considers that debtors would be better protected in the medium run if they requested, to
a larger extent, to enter fixed interest rate credit agreements. Additionally, within the
National Committee for Macroprudential Oversight, the NBR has underlined the financial
stability risks deriving from soft budget constraints in the economy. In order to strengthen
the economy's resilience to external shocks, particularly those related to credit risk, it is
necessary to have in place a prudent and balanced mix of economic policies that should
pursue the return to the medium-term objective (structural deficit narrowing) and the
improvement of payment discipline economy-wide.
Charts
debt
3.5
8.1 5.8
Jul.17
debt
3.5
8.0 5.8
2016
public
issued
of
7.8 5.7 3.0 debt
2015
total domestically eurobonds
- - -
Romania:
5.3 3.0
7.2
2014
2.
maturity
maturity maturity maturity
6.2 4.4 2.4 2013
Figure
residual residual residual
residual
5.8 4.1 1.7
2012
average average average
MPF
4.0 1.6
2011
3.8
years
Average
Source:
9 8 7 6 5 4 3 2 1 0
EA
EU
EE
LU
BG
CZ
DK
LV
SE
debt
RO
LT
SK
PL
MT
NL
Public
.
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DEFI
2017 Oct.
2017 Sep.
reserves
2016 Dec.
reserves
2015 Dec.
2014 Dec.
exchange
International
4.
2013 Dec. foreign
bn.
2012 Dec.
Figure NBR
gold
EUR
5 0
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Aug.
2017
debt
2016
debt
public
2015
public
3.
2014
external
external
igure
2018*
2017*
2016
2015
2014
worldwide
economies
area
2013
rates
advanced euro US
2012
growth
2011
2010
scenario
economies
2009
Economic
baseline
-
5.
2008
developing
2017
and
2007
Figure
omy October
market
68 66 64 62 60 58 56 54 52 50
Q3* 2017
4.9
65.5
percent
2016
2015
rates
2014
2013
2012
Q2.
2011
2017
employment to
2010
refer
and
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(rhs)
rate
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rate
2007
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for
2005
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data
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6.
rate
2003
available
t
ment
gure
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Nov.17
bn.
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ROBOR
3M
Sep.17
operations
repo
Aug.17
of
Jul.17
ROBOR
volume
Jun.17
overnight
and
May.17
rates
Apr.17
(rhs)
volume
Interbank Mar.17
repo
7.
EU 4.5 2.9 7.0
15.7 14.3 45.0 61.5 14.2
117.5
Jun.17
7.96 5.85 7.80
17.15 17.15 59.37 12.14 54.80 76.30
Sep.17
8.32 5.90 7.88
17.84 17.84 59.13 12.13 55.45 75.26
Jun.17
9.36 6.37 7.86
17.72 17.72 56.79 11.19 61.36 75.77
sector Mar.17
Romania*
9.62 6.36 8.15
2016
17.55 17.55 56.34 10.10 53.19 74.34
8.43 8.17
2015
banking 16.72 16.72 13.51 57.72 11.89 58.46 78.18
the
8.91
2014
14.56 14.56 20.71 55.61 11.90 55.76 82.49
-14.44
for
range
methodology
EBA
prudential <3% >8% >4% <6% to
<12x >15x
>15% <12% >14% <11% >55% <40% <1,5% >10% <50% >60%
<100% >150%
[3%-8%]
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[1,5%-4%]
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[50%-60%]
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16
15
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13
own
12
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of
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10.
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value
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Figure
potential median impact
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10987654321
0
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Source:
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17 Sep.
EU 17 Jun.
17 Mar.
the
16 Dec.
and
16 Sep.
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16 Jun.
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16 Mar.
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Sep.17
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Jul.17
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May.17
Mar.17
Jan.17
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Nov.16
for Sep.16
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May.16
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Mar.16
Jan.16
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Indicators
by
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(rhs)
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12.
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May.15
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of
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NBR
Nov.14
Figure
Sep.14
percent
5 0
Source:
30 25 20 15 10
120 100 80 60 40 20 0
percent
sector
217
outflows.
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239
percent.
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banking
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Total
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mber reserves
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. n-OSII
t cally
quired
Sep.17
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10
May.17
Mar.17
Jan.17
Nov.16
Sep.16
Jul.16
May.16
Romania
Mar.16
in
Jan.16
Nov.15
ratio
Sep.15
Jul.15
NPL
ratio
May.15
Mar.15
Jan.15
loan
Nov.14
NBR
21.5 Sep.14
percent
5 0
25 20 15 10
Source:
GR
EU PT
LU
the
SEFI
in
Non-performing
NL
PL
2017)
FR
13.
ratio
BE
DK
NPL
June
DE
EE.
-
GB
Figure the
MT,
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SI,
CZ
of
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e LV
for
credit Consumer
ratio
2015 2016
2017
loans estate
real Residential
Dec. Dec. Sep.
loan
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loans estate
real Commercial
debtor
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non-performing
SMEs
of
and
corporations
Non-financial
NBR
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Dynamics
Total EBA,
percent
5 0
Source:
35 30 25 20 15 10
credit Consumer
loans estate real Residential
coverage
2017)
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banks
loan
non-performing
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the
of provisions,
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Total
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Breakdown e orming
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Sep.17
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Dec.15
Dec.14
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Dec.13
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of
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Dec.12
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Dynamics
Dec.11
15.
deposits
Dec.10
Figure
Dec.09
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l eserves ities
50 40 30 20 10 0 -10 -20 -30
13
entities
Total
28
27
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26
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24
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23
Romania
22
loss;
21
Romanian
in 20
implementing
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18
17
of
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16 (expected
15
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14
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13
12
by
(June
11
institutions
Impact 9
capital
total impairment credit
17.
points
IFRS in in
and
the
NBR
change change
Figure
percentage
10895673412
1 0
Source:
-1 -2 -3 -4 -5 -6 -7
BG
HU
CZ
2016
RO
LTSI
ROA,
SK
MTIE
PL
Profitability data
sector:
AT
g
6.
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NL
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period
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and
outlook
risks
economies
the
of
banks
stability
vulnerabilities
both
Map
indicate
equilibria
emerging
18. in
financial
through
economy,
to
Arrows
the
prices
Figure
risks
in
sentiment
of
macroeconomic
intensity.
risk
property
Map indebtedness
risk
risk
investor
in
discipline
risk
in
risk
ehold ic
rrounding c
ent ase
hows
emic ystemic
on
15
Nov.17
Republic
Sep.17
Czech
Jul.17
May.17
sovereign
Mar.17
issued
on
Jan.17
Poland
Sep.17
May.17
Jan.17
countries
Sep.16
quotes
May.16
Jan.16
Hungary
CEE
Sep.15
May.15
instruments
calculations
CDS
Jan.15
by
Sep.14
NBR
May.14
20.
debt Jan.14
points
Sep.13 Romania
Reuters,
May.13
basis
Jan.13
Figure 0
50
Source:
450 400 350 300 250 200 150 100
Sep.17
Jul.17
May.17
Poland
Mar.17
Jan.17
government
yields
Nov.16
d
gary
many
year
goods
the
Consumption
goods
of
2017
on
goods
Capital
January-July
balance
Composition
goods
the
Intermediate
2016
22.
on
Figure
Primary January-July
NBR
deficit
commodities
percent
0
Source:
60 50 40 30 20 10
8 6 4 2 0 -2 -4
H1 2017
percent
2016
2015
dynamics
services ion
points
(rhs)
Determinants
GDP
-3.0 -3.9 -2.3 -4.3
2018*
of
-3.0 -3.0 -1.6 -3.3
2017*
percent
Commission
-2.4 -3.0 -1.5 -2.2
2016
European
the
0.9
and
-1.4 -0.8 -0.3
deficit
2015
payable
deficit)
component
0.3
-1.7 -1.4 -0.4
2014
(cash
budget
interest
cyclical
the
-2.5 -2.1 -0.4 -0.9
Finance
2013
for
excluding
Public
of
2010)
-2.5 -3.7 -1.9 -2.4
adjusted
2012
government
(ESA
Ministry
balance
-4.2 -5.4 -3.8 -2.9
the
2011
balance
by
General
-6.3 -6.9 -5.4 -5.6
government
2010
23.
produced
government
output)
eneral
eral
were
ure
2017f
18
2016
2015
MTO
2014
at
2013-2015
government
2013
deficit
2012
2011
General
2010
structural
25.
2009
GDP
of
Eurostat
2008
Figure
ECB,
forecast
2007
f)
percent
0
-1 -2 -3 -4 -5 -6 -7 -8 -9 Source:
-10
+
Q3*** 2017
flows 2016
earnings)
of
deficit
earnings)
2015
of
2014
capital
2013
funds
reinvestment
account
2012
reinvestment
flows**
(incl.
2011
(incl.
2010 investment
ance
data
equity ance* capital ety
urrent
t-creating
Jun.17
services
Dec.16
loans
loans
Jun.16
Dec.15
management
consumer housing
Jun.15
sold sold
of of
Dec.14
provide
to
Jun.14
stock stock
debt*
Dec.13
continues
Jun.13
total
bank
Dec.12
NBFIs the
-
NBFIs
Jun.12
-
which
loans
Dec.11
loans
for
Jun.11
Households'
loans
Dec.10 consumer housing
sold
26.
Jun.10 to
only
Dec.09
Figure
Jun.09
refers
banks
-
banks
Dec.08
-
ns loans
s
100 90 80 70 60 50 40 30 20 10 0
Sep.17
rate
percent
Sep.16
years)
5
type
Sep.15
interest
below
fixed
rate Sep.14
(maturity
Sep.13
loans
Sep.12
interest
years)
by
Sep.11
(1-5
Consumer
rate
Sep.10
flows
Sep.17
interest
Sep.16
fixed
credit
of
Sep.15
Sep.14
loans
Share
rate
Sep.13
27.
Housing
interest
re
e
Sep.12
TOTAL
x
>2
wage
loans
average
average Consumer
wage; wage]
wage
x
(average
2
wage; wage