Romania: Ex Post Evaluation of Exceptional Access Under the 2009 Stand-By Arrangement

International Monetary Fund

No 2012/064, IMF Staff Country Reports from International Monetary Fund

Abstract: This paper discusses ex-post evaluation of Romania’s exceptional access under the 2009 Stand-By Arrangement. Concerns about Romania’s external and fiscal sustainability have triggered significant increase in external borrowing costs as sovereign yields jumped to 9 percent. Banks also came under increasing pressure, with liquidity drying up from the interbank market. Rollover risks also increased as the maturity structure gradually deteriorated, and reserves coverage of shorter-term external debt declined. The large and front-loaded financing along with upfront fiscal actions has helped quickly to restore market confidence, with a successful return to private financial markets during the program period.

Keywords: ISCR; CR; banking sector; exchange rate; current account; central bank; arrears PC; financing program; funding regime; authorities commitment; program conditionality; public finance; short term; Fiscal sustainability; Arrears; Europe; Global (search for similar items in EconPapers)
Pages: 32
Date: 2012-03-27
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