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Loan Losses Provisioning Processes In Romanian Banks During January 2007 €“ February 2011


  • Adela Socol

    (1 Decembrie 1918 University of Alba Iulia)


The paper presents the loan loss provisioning phenomenon at the level of Romanianbanks, based on a very detailed set of rules in the area. Using data collected by National Bank ofRomania, we find evidence of the significantly increase in the banking loan loss provisions in the lastanalyzed years. We investigate the dynamics of the loan losses provisioning processes and present thenational regulatory framework. The paper concludes that the actual situation in the field forceRomanian banks to react and improve their risk management.

Suggested Citation

  • Adela Socol, 2011. "Loan Losses Provisioning Processes In Romanian Banks During January 2007 €“ February 2011," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 1(13), pages 1-11.
  • Handle: RePEc:alu:journl:v:1:y:2011:i:13:p:11

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    References listed on IDEAS

    1. Vincent Bouvatier & Laetitia Lepetit, 2006. "Banks'procyclicality behavior : does provisioning matter ?," Cahiers de la Maison des Sciences Economiques bla06035, Université Panthéon-Sorbonne (Paris 1).
    2. Benston, George J. & Wall, Larry D., 2005. "How should banks account for loan losses," Journal of Accounting and Public Policy, Elsevier, vol. 24(2), pages 81-100.
    3. Ioan Nistor & Mirela Pintea & Maria Ulici, 2010. "The Implications Of The Global Crisis On The Financial Performances Of The Romanian Banking System," Analele Stiintifice ale Universitatii "Alexandru Ioan Cuza" din Iasi - Stiinte Economice, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, vol. 2010, pages 149-160, july.
    4. Kanagaretnam, Kiridaran & Lobo, Gerald J. & Yang, Dong-Hoon, 2005. "Determinants of signaling by banks through loan loss provisions," Journal of Business Research, Elsevier, vol. 58(3), pages 312-320, March.
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    More about this item


    Loan Loss Provisions; Loan Classification in Romanian Banking System; Provision Coefficient;

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation


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