Raiffeisen bank aborts completion of its real estate projects

Raiffeisen Bank will stop funding the real estate projects in Romania of this year and of next year, if the market conditions will improve. The bank aborted the projects it had in construction this summer, said the first vice president of the bank, Marinel Burduja.

The bank will no longer fund the real estate projects it planned late this summer, of 600 million euros. The credit portfolio on this segment remained at this year’s summer level, of 400 million euros, said Burduja, NewsIn informs.

“As long as there is no demand, Raiffeisen will stop the funding proceedings. We chose to stick with the projects we have already approved,” said the first vice president of Raiffeisen Bank Romania.
Furthermore, Burduja said the investments in real estate projects are no longer a priority for Raiffeisen Bank Romania in 2009 as well.

“We will complete these approved investments, but we will not start any project next year if the current market climate will not be improved. We will probably finance projects in case of high demand, but we will be extremely cautious,” said Burduja.

During Romania Top 100 conference in November 12, Marinel Burduja said certain banks had cut the credit lines for long and medium term, but as far as the short term is concerned, the banks see no major problems.

On the other hand, the first vice president of Raiffeisen Bank said the bank had anticipated “six months ahead that the Romanian economy and especially the real estate sector have a high risk potential”, and maintained an “extremely conservative approach”.

Translated by Camelia Oancea

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