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Bankers granted three times fewer loans for agriculture than real estate

"The increase in the number of failed real estate projects financed by banks, both on the residential and on the retail segment is raising doubts about how bankers calibrated their loan portfolios, as long as real estate accounts for up to 10% in their balance sheets and a field with guaranteed sales such as agriculture for merely 3%.
At the end of the first quarter of 2010, the volume of loans granted to the agricultural sector reached 6.8 billion RON (1.65 billion euros), the same as at the end of 2008, NBR data reveal.
Banks have long neglected agriculture and only after farmers gained access to structural funds did they start to finance their projects. As a result, the volume of loans granted to this sector started to increase as late as the last three or four years, doubling from 2006 through the end of last year.
At the same time, loans granted to the constructions sector almost tripled, to 9% of the total loans. The volume of loans to this sector reached 22 billion RON (5.4 billion euros) in March, having maintained relatively constant over the past year, considering last year's recession dealt it a heavy blow.
Over the past year, almost 15 big residential and shopping projects have failed in various stages of completion or their developers went insolvent, causing banks to set aside very expensive provisions." by Ziarul Financiar team.