The state is planning to attract over RON 40 billion from the population in 2025 by issuing Tezaur and Fidelis government bonds. These bonds offer attractive interest rates compared to bank deposits, making them a competitive option for investors. In 2024, Tezaur and Fidelis instruments accounted for a significant portion of Romania’s public debt, indicating a shift towards retail borrowing.
Stefan Nanu, Treasury director, stated that the state aims to increase the amount attracted from the population, with a target of over 40 billion RON in 2025. To achieve this goal, the Ministry of Finance plans to enhance the frequency of Fidelis bond issues, making them available monthly.
During the COVID-19 pandemic, Romania saw a surge in borrowing from the population, with the state borrowing substantial [mepr-show rules=”1611″ unauth=”both”]amounts to cover the budget deficit. While this strategy aims to diversify funding sources, economists caution that relying too heavily on retail loans may indicate a saturation of traditional sources.
Despite the risks, the population’s resources are significant, with savings in banks reaching over RON 197 billion. The state’s decision to target retail customers comes with higher operational costs but offers an alternative to foreign market financing, which could increase currency risk.
The Ministry of Finance recently launched Tezaur government bonds with competitive interest rates, outperforming bank deposit rates. This move aims to attract more investors to government securities, despite the associated market risks.
Adrian Codirlasu, president of CFA Romania, highlights that while government bonds offer better returns, they also pose higher risks compared to bank deposits. The fluctuating interest rates and market conditions require careful consideration for investors.
In conclusion, the state’s strategy to attract funds from the population through government bonds reflects a shift in borrowing practices, emphasizing the need for a balanced approach to debt management and financing.
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