“Repayment fees cannot be eliminated. If the money comes sooner, the bank cannot always place that money immediately, and the client must pay the interest rates to which he has committed. However, I believe that the minimum level of one percent is reasonable,” Radu Graţian Gheţea, President of the Romanian Banking Association (ARB), said.
Romania must implement a European directive by May 2010 regarding the repayment fee. European regulations include the complete elimination of repayment fees on consumer loans with a variable interest rate. In the case of consumer loans with fixed interest rates, repayment fees will be limited to one percent.
Bogdan Chiriţoiu, President of the Competition Council, indicated that in Romania only the clients take risks, considering that the banks set a fixed margin and a variable interest rate, while in other European countries, loans are calculated at a fixed interest rate, and thus lenders take part of the risk.
“We analyzed competition at the banking level and, especially, to what extent bank fees prevent clients from migrating from one bank to another. This is where the repayment fee comes in, which prevents this movement of clients between banks,” Chiriţoiu said recently.
A report published by the European Commission at the end of September indicates that the degree of transparency of Romanian lenders, in terms of fees, is below the European average.
The study shows that there are serious problems regarding the way banks inform and advise their clients. More than 70 percent of Romanian lenders included in the study had to provide additional information or clarify the information posted on their Web sites.
