Abstract:

The implication of foreign currency lending for financial stability became one of the most important issues appointed to the attention of policymakers especially when global financial crises became evident. In Romania, the high indebtedness rate, especially in foreign currencies, is the main vulnerable spot of the population sector. Foreign currency lending can increase financial vulnerability and the risk of systemic crises in several dimensions. This is the reason for which, the main objective of this paperwork is to analyze the factors that influence the customers in their decision to borrow in foreign currencies. In this matter, it was used a regional econometric model for panel data in order to see Romania’s customers borrowing preferences and to analyze if the crises have changed their behavior.