Title: National Bank of Romania’s Proactive Approach to Financial Risks: Prudential Supervision of Credit Institutions and Non-Bank Financial Institutions
Introduction
The National Bank of Romania (NBR) has implemented strict measures to safeguard depositors’ interests and maintain a stable banking sector. This article outlines how NBR carries out the prudential supervision of credit institutions and non-bank financial institutions, as well as their compliance with various regulations.
Prudential Supervision of Credit Institutions and Branches
According to Emergency Ordinance No. 99/2006 and Law No. 227/2007, NBR is responsible for prudential supervision of credit institutions and Romanian legal entities, which includes their branches situated in EU member states or third countries. Some responsibilities involve:
- Setting banking indicators: To measure the financial health and stability of an institution.
- Monitoring compliance: Ensuring institutions follow existing banking regulations.
- Conducting assessments: Identifying and addressing specific banking risks.
To ensure effective supervision, NBR collaborates with foreign authorities through written coordination and cooperation arrangements.
Oversight of Non-Bank Financial Institutions
As per Government Ordinance No. 28/2006, NBR is in charge of the monitoring and prudential supervision for non-bank financial institutions registered with Romania’s General Register, along with those registered with the Special Register and conducting business within Romania.
Regulatory Compliance
NBR ensures all entities under its supervision adhere to various regulations, including:
- Law No. 656/2002: On the prevention and sanctioning of money laundering and terrorist financing.
- Government Emergency Ordinance No. 202/2008: On the enforcement of international sanctions.
- Law No. 535/2004: On preventing and fighting terrorism.
- Associated regulations: Various other implementing acts.
Infringement Identification and Sanctions
Despite a comprehensive approach, NBR retains the power to identify infringements and impose sanctions, as per these regulations.
Conclusion
The National Bank of Romania’s proactive stance in financial regulatory oversight demonstrates its dedication to protect depositors’ interests, promote a sound financial sector, and adhere to international financial standards.