1 Decembrie 2008

Cinteza, BNR: A bank in Romania was exposed to Lehman Brothers collapse

Mid august, National Bank of Romania (BNR) started to review the players of the banking scene in Romania, the only alarming conclusion being that a local bank was exposed to Lehman Brothers’ failure.

“We find the beginning of our problems in the banking system in August, when we tried to identify the banks likely to encounter problems with insecure placements. There was only one bank exposed to Lehman Brothers”, said Nicolae Cinteza, manager of the Supervisory Directory within BNR, without disclosing the cost of this exposure.

Later on, BNR started to review the foreign liabilities of the banks, with focus on their maturity.

Lehman Brothers invoked in September Chapter 11 of protection against bankruptcy.

The bankruptcy was the collapse of this 158-years old lender that managed to overcome two world wars, or the failure of Long-Term Capital Management investment fund, whereas it was the major casualty of the subprime crisis.

The fall of Lehman Brothers is by far, the biggest collapse in the history of United States, the lender holding assets sixfold larger than those of WorldCom telecommunication firm, that called upon protection from creditors in 2002, and ranked second in hierarchy.

Translated by Camelia Oancea

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