Evolving Efficiency in Romania’s Banking Sector: A Long-Term Assessment of Performance and European Alignment

This study examines the evolution of banking efficiency in Romania between 2010 and 2023 by employing a comparative assessment of key financial indicators relative to the European Union average. Using official statistical data sourced from Eurostat and World Bank Group, the analysis integrates general expenses relative to assets, the cost-to-income ratio, return on assets (ROA), return on equity (ROE), and the dynamics of non-performing loans (NPLs). A longitudinal methodological approach enables the identification of structural trends, cyclical shifts, and convergence patterns, highlighting critical stages such as the post-crisis adjustment, the consolidation phase, and the accelerated modernization driven by digital transformation. The results show that although Romanian banks initially exhibited weaker operational efficiency and lower profitability compared to the EU, significant improvements have taken place following balance-sheet restructuring, enhanced risk management, and the accelerated adoption of digital technologies. The sharp decline in NPLs and the substantial increase in ROE after 2015 demonstrate a notable strengthening of financial performance. Despite persistent gaps in ROA and cost structures, the Romanian banking sector has shown increasing convergence with European standards. Overall, the study emphasizes the essential role of digitalization, cost optimization, and technological integration in enhancing long-term competitiveness and resilience within the Romanian banking system.