Developing Recommendations for Financial Institutions in Romania

Bill Seas | VIP Assignment, September - October 2000

In the late 1990s, negative experiences with several banks and investment funds had created an unfavorable impression of the security of the banking system in Romania among residents. The discontent was further exacerbated by years of devaluation of the Romanian currency and the restrictions instituted by banks that prevented, or limited access to, savings products by the typical Romanian citizen.

The Integrated NGO and Economic Development Program (INED), which began in 1999, was aimed at strengthening small businesses by ensuring access to micro credit for enterprises in the area.The program also served to develop the skills of other NGOs and local institutions to support the continuation of growth of businesses and the economy.

In September and October of 2000, Bill Seas, a Visiting International Professional (VIP™) with CHF International, traveled to Romania to assist with development of community financial institutions through the Integrated NGO and Economic Development Program (INED).His objective was to research, evaluate, and recommend an implementation strategy for a private deposit insurance system.The system was meant to address the unwillingness of many Romanians to place savings in banks or other forms of financial intermediaries.

Bill spoke with a number of different stakeholders in the area to achieve a better understanding of the local environment.He also reviewed existing laws and regulations that may have affected CHF’s intentions to implement this program in Romania.After Bill had sufficiently researched the various factors effecting the development of the private deposit insurance system, he offered recommendations on how to implement the project, including specifics on what should be taken into account for CHF to be successful in achieving its goals.

Bill reported that he found his experience in Romania rewarding, and was thankful for the opportunity to work with CHF and its staff while contributing to this project.