The EU discriminates Romania in the CEC recapitalization affair

The EU’s Competition Directorship refused to validate as legal the recapitalization initiative of one of the two Romanian banks through which the state plans to save the economy. Instead, Ireland gets, as an “incentive” to review the referendum of the Lisbon Treaty approval, the go-ahead for state aids to a similar bank, eight times larger than the funds requested by the Romanian government for CEC Bank.

With a state aid of 2.5 billion RON, the Romanian state wants to consolidate the position of a inland bank, through which it can support local businesses, using preferential financing schemes, and to be able to intervene on the market, dominated by foreign banks who’s appetite for local investments is extremely low.

The European commission concluded that a financial aid would strengthen CEC Bank and it would give it an advantage over its competitors, who do not benefit from financial support from the government.