Many Romanian company owners are primarily concerned aboutpreserving their living standards, and prefer to file forinsolvency rather than add to their capital, whilst multinationalsboost the capital of their subsidiaries, says Rasvan Radu, chiefexecutive of UniCredit Tiriac Bank.
"This is now a true phenomenon. Their chief concern is toaccumulate a personal fortune and prefer to keep the money in theirown accounts, including foreign accounts, which proves a lackconfidence in the prospects of the businesses they created. Theremarkable thing is that multinationals continue to contributecapital to support local subsidiaries, a sign that foreigners havefaith in the development of the market," said Radu, head of one ofthe largest banks on the Romanian market. He says localentrepreneurs would not even hear about pledging collateral orabout contributing additional capital to show their personalcommitment to the business's recovery, which could secure them newfunding.
The banker warns that such behaviour will remain indatabases.
"All records will obviously be kept. Unfortunately, we have notreached the level where Romanian entrepreneurs are keen to leavebehind a solid family business, even though there are alsoexceptions, when everything is reinvested or only very little iswithdrawn from the company. Individual protection is the prevailingtrend, and so is ignorance as to the limit of bank'sinvolvement."
Radu says it is not the bank's job to "carry the load" of aproblem company, as some entrepreneurs believe, because the bankdoes not partake in the company's profit, it only gets theinterests charged on the loans. He adds it is normal that theentrepreneur should be the first to bear the burden in a time ofcrisis. In an interview given to ZF, Patrick Gelin, president ofBRD, in turn noticed the behaviour of company owners who keep theirmoney abroad instead of supporting their businesses.
"Owners need to take responsibility for their business. We knowmany of them have money abroad."
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