Romania‘s anti-trust body announced on Thursday that it is investigating ten banks for allegedly agreeing to increase the three-month Romanian Interbank Offer Rate (ROBOR), according to See News.
The Competition Council has completed unannounced inspections carried out at the headquarters of ten banks participating in establishing the ROBID/ROBOR reference rates, it said in a press release.
The inspections took place as part of the investigation into possible agreements between the banks for increasing the ROBOR interest rate to the highest possible level. The ROBOR soared to 8.19% from 2.36% a year ago, according to Romanian central bank data.
The documents seized during the inspections are being analyzed by the Council according to specific procedures.
“The potential anti-competitive practice affects the entire territory of Romania, as the ROBOR index established by the 10 banks is a component of the price (interest rate) for loans in lei with variable interest granted to individuals before May 2, 2019 and loans in lei with variable interest granted to legal entities from all economic sectors,” the competition authority said.
According to the Competition Council, the law prohibits any agreements between companies and concerted practices that prevent, restrict or distort competition on the Romanian market, especially those that involve setting prices for purchase or sale or any other trading conditions.
Competition Council president Bogdan Chiritoiu confirmed the investigation on Wednesday, local media reported.
The Romanian Association of Banks, ARB, stated on Wednesday in a press release that it welcomes the investigation, but noted that increases in interest rates – both at the level of consumers and at the level of interbank markets – are registered not only in Romania, but globally, in the context of the inflationary wave.
The ten banks which set the ROBOR rate are Banca Transilvania, BCR, BRD-Societe Generale, ING Bank, Raiffeisen Bank, CEC Bank, UniCredit Bank, OTP Bank Romania, EximBank and Intesa Sanpaolo Romania, according to ARB.
In August, central bank governor Mugur Isarescu said during a presentation of its latest inflation report that banks ‘overreacted’ in establishing the ROBOR and failed to couple it with the actual increase of the key rate.
“(…) these are market interest rates, and markets have this tendency to over-react. This is how markets work all over the world, especially in times of crisis and tension,” Isarescu said at the time.
On October 5, BNR increased the monetary policy rate to 6.25% from 5.50%.