CONSTRAINTS OF THE ROMANIAN BANKING SYSTEM DEVELOPMENT-AN INTERVIEW-BASED STUDY

In the process of transition from planned to market economy, the Romanian banking system has undergone a complex restructuring process form mono-bank system to the two-tier banking system. The large state banks were privatized and European banking groups have invested in Romania, especially after the European Union accession in 2007. However, currently, the Romanian banking system faces some challenges and constraints of development, amid the consequences of the global financial and economic crisis, and the limitations of the business models developed in the pre-crisis period. This article proposes a qualitative research, based on the interview method, on the development constraints and challenges of the Romanian banking system. The results emphasize among these constraints and challenges: low level of financial intermediation, amid a fragile economic environment, pressure of regulatory framework on credit activity, high level of credit cost, low level of domestic saving and high level of household indebtedness, diminishing of trust in the banking system, low level of financial education.