Romania’s Banking Sector Adapts to Evolving Regulatory Landscape

The Romanian government and financial authorities have been busy over the past year, issuing a series of regulations aimed at ensuring compliance with European Union banking and finance laws. These new rules are designed to promote transparency, sustainability, and investor protection in the country’s financial markets.

Environmental Sustainability in Financial Instruments

One significant development is the adoption of standards for “ecological” financial instruments, which support environmentally friendly economic activities. The Romanian government has introduced new rules requiring:

• Independent evaluators to verify compliance with sustainability principles
• Assessments of proposed projects for environmental impact mitigation
• Issuers to prepare pre-issuance information sheets and post-issuance impact reports

Payment Incidents Registry Regulation

The National Bank of Romania (NBR) has issued a regulation for the Payment Incidents Registry, which is designed to manage a database of payment incidents related to:

• Checks
• Promissory notes
• Bills of exchange

Reporting entities must provide information on major and minor payment incidents, and credit institutions are required to notify payers in case of a major check-related incident leading to a banking restriction.

MiFID II Suitability Requirements Regulation

The Financial Supervisory Authority (FSA) has introduced a regulation aimed at implementing ESMA guidelines on certain aspects of the MiFID II suitability requirements. Key changes include:

• A redefined distinction between active and inactive clients
• Clarification of investment firm obligations to review business continuity plans
• Removal of prudential requirements

Exchange Regulation Amendment

Another recent development is the amendment to the exchange regulation by the NBR. The new rules impose monitoring obligations on certain financial entities to ensure compliance with exchange control requirements. These entities are now required to verify that transactions between Romanian residents are performed in the local currency.

Conclusion

These regulatory developments demonstrate Romania’s commitment to ensuring a stable and transparent banking sector, while also promoting sustainable economic growth and investor protection. As the country continues to adapt to evolving EU regulations, it is likely that further changes will be implemented to ensure compliance with international standards.