(Adds quotes, central bank, background)
By Radu-Sorin Marinas
BUCHAREST Oct 7 Romanian parliamentary
committees are likely to approve on Monday a bill to help Swiss
franc borrowers convert mortgage loans into leu currency at
historical rates, deputies said on Friday, going against central
Before the financial crisis, thousands of East Europeans
took out low interest rate loans in currencies such as the Swiss
franc, only to find these loans hard to repay after their own
national currencies slumped in value.
Governments across the region have been looking at ways to
reduce the debt burden on their citizens - such as converting
the loans into domestic currencies at the original exchange
rates - without imposing a crippling burden on banks.
Over the past weeks there have been debates among Romanian
MPs on converting loans including one proposing the conversion
of hard currency loans by individuals at historical exchange
rates plus a 20 percent increase, or offering state guarantees
to banks and a discount to borrowers.
A drive to offer legislative support to Swiss franc
borrowers has intensified this year and as political parties
position for a Dec. 11 general election.
"We back a historical rate conversion. There's agreement
(among MPs). We should have approved this long time ago, people
are right to have demanded this solution," legal committee
member Nicolae-Ciprian Nica told Reuters.
Social Democrat deputy Iuliu Nosa, vice-president of the
Budget and Finance committee said: I'm confident that nothing
surprising can happen, I do expect conversion at historical rate
solution to clear committee on Monday and, if all goes well,
will pass parliament later in the week."
"Costs for banks would be bearable."
A final vote in the legislative assembly could occur as
early as on Tuesday, they said.
Eugen Nicolaescu of the rival Liberal Party - the country's
second largest political grouping after PSD - and a
vice-president of the same commission, who said he could not
rule out a "last minute" change said that: "All opinions are
converging towards converting outstanding Swiss franc loans at
the exchange rate they we taken."
The central bank said that, if approved, such a measure will
have an impact of about 2.4 billion lei ($600 million) on local
banks from exchange rate difference.
It said that out of a total number of about 70,000 loans,
there have been about 57,000 conversion and restructuring
request filed by borrowers of which about 34,000 have been
solved through direct negotiation between the parties.
The Dec. 11 national ballot will produce a new parliament
that will propose a prime minister to replace incumbent premier
Dacian Ciolos who came to power last November with a caretaker
team of technocrats for a limited, one-year mandate.
Opinion polls showed the leftist Social Democrats likely to
garner most votes, around 38-40 percent followed by the centrist
Liberals with about 30-32 percent.
($1 = 4.0383 lei)
(Reporting by Radu Marinas)