“When the economy was in trouble, the bubble in the banking system burst, and the decline was as fast as the increase. I believe that the best thing for this sector would be sustainable growth, correlated with the economic evolution,” Erhan said.
According to the official, in the case of Millennium Bank, the volume of nonperforming loans is below the market average. Regarding the situation of clients who are facing problems in paying their instalments, Erhan added that some 400 clients have applied for loan restructuring since the beginning of this year, of which 30 percent were solved.
“These are clients who have a good payment history, but who lost their jobs and are no longer able to pay their debts. Unfortunately, however, many of the applications we received were unjustified. I believe that the message sent by other financial institutions early this year, related to the openness of banks to these restructuring [activities], brought many unfounded requests to Millennium Bank too,” the bank official said.
Erhan said that Millennium Bank has rethought its lending policies. “We raised the minimum age for loans to 25 years from 18, because this client category registered the highest level of arrears. Also, the unemployment rate on this segment is presently 20 percent, compared to 7 percent on the market,” Erhan said. Moreover, the bank decided not to grant any more mortgage-free consumer loans.
