The governor of the National Bank of Moldova Dorin Dragutanu denied the information that the economic entities cannot obtain loans from banks. In a program on Radio Moldova station, the official said the banks this year have attracted by 20% more deposits or new deposits of about 3.5 billion lei. The volume of loans rose by 18%. There were released new loans of approximately 3.3 million lei, Info-Prim Neo reports. “The loan growth rate is higher than last year, while the interest rate on loans has decreased the second year. In August, it hit a historical minimum of 14.9%,” said Dorin Dragutanu. According to him, a sudden rise in the volume of loans would be good neither for banks, nor for economic entities or the national economy in general. “Let’s see what’s happening in Belarus’s economy. All kinds of loans were released to economic entities and private individuals in this country during the last few years. The crisis struck and they cannot repay the loans now. The macroeconomic situation destabilized and went out of control. The inflation rate reached 60%. If our banks granted loans at the first request without thoroughly analyzing creditworthiness, the economic entities at first will have more resources and will work better, but the situation will worsen when they will not have money to repay the loans,” said the governor. Dorin Dragutanu also spoke about the situation in Moldova. “In 2007-2008, the loan growth rate was rather high. But the consequences of the crisis became more prominent in 2009 and affected mainly the real sector of the economy. The percentage of nonperforming loans rose from 5% to 17%. These are huge losses not only for the banking sector. They can lead to financial and macroeconomic instability,” he stated According to Dorin Dragutanu, a growth rate of 20% a year is normal and sustainable for an economy in transition. As to the interest rate on bank loans, it will decrease if Moldova’s economy undergoes structural reforms and develops and if the macroeconomic stability is ensured. “The interest rate cannot be 5% when the inflation is twice higher. That’s why the main objective of the central bank is to target inflation,” said the governor.