NBR statistics point to an acceleration in the credit market in February, confirming resilience to tensions in the public arena and validating BT’s central macroeconomic scenario.

We believe this was driven by factors such as low interest rates, excess liquidity and firmer consumer and business confidence.

As a result, the stock of total non-government loans rose 0.8% m/m to RON 219.8 billion in February.

It is worth noting that RON‑denominated lending increased by 1.4% m/m to RON 126.9 billion (an all‑time high), a development that also reflects private‑sector interest in taking advantage of the tail end of the cheap‑money period. Household loans were up 1.2% m/m to RON 67.1 billion, while the stock of loans to companies climbed 1.6% m/m to RON 59.8 billion.

At the same time, foreign‑currency lending edged up 0.1% m/m to RON 93 billion last month. This was driven by corporate lending (up 0.9% m/m to RON 47 billion), supported by record‑low EUR funding costs. By contrast, household FX loans fell 0.7% m/m to RON 45.9 billion.

Compared with February 2016, the stock of non‑government loans was up 2.1%, the strongest pace since May 2016.

RON lending stood out with 13.9% y/y growth, with the household and corporate segments up 24% and 4.4%, respectively.

The pace of decline in FX lending also eased in February to 10.6% y/y (the slowest since October 2016): the household and corporate components fell 13.6% y/y and 7.3% y/y, respectively.

As a result, at end‑February the RON share of total non‑government loans stood at a record 57.7%.

Therefore, in January–February 2017 the stock of total non‑government loans edged down 0.1% YTD: a 0.7% YTD increase in the RON component offset a 1.3% YTD decline in the FX segment.

On an alternative breakdown, household lending was flat at RON 113 billion in the first two months of 2017. The 1% YTD drop in consumer loans (to RON 51.4 billion) was offset by a 0.8% YTD increase in mortgage loans, to RON 58.9 billion (an all‑time high).

By contrast, corporate loans fell 0.23% YTD to RON 106.8 billion over January–February 2017.

In our central forecast, we expect the stock of total non‑government loans to increase at average annual rates of 2.9% in 2017, 3.7% in 2018 and 2.2% in 2019.