The European Commission has approved Romania’s planned €200mn capital increase for state-owned CEC Bank, allowing the country to proceed with strengthening the lender’s financial position, according to a Commission's press release.

The announcement, made on 24 March, confirms that the capital injection is in line with market conditions and will provide returns consistent with those expected by a private investor.

The move will raise CEC Bank’s capital by 40% to RON3.5bn (€750mn), supporting its continued expansion.

Romania first notified the European Commission of its intention to increase CEC Bank’s capital in September 2024. The proposal included a business plan covering 2025-2028, a long-term outlook for 2029-2032, and a report on the "private investor test," all of which have been reviewed by the Commission. In previous years the bank has grown rapidly, climbing from the sixth-largest to the third-largest lender in Romania by assets at the end of 2022, overtaking Raiffeisen Bank, ING Bank and BRD-SocGen. At the end of 2023, its assets had surged 35% to RON83.5bn (€17bn), putting it behind only Banca Transilvania and Banca Comercială Română, part of Erste Bank Group.

According to the European Commission’s assessment, Romania’s business plan for CEC Bank anticipates an increased market share in lending and deposits, improved efficiency and robust capital levels.

The Ministry of Finance, as the bank’s sole shareholder, has also included a further RON1bn capital increase in its 2025 budget planning, alongside a RON1.25bn capital injection for state-owned Exim Banca Românească.

In parallel with the capital increase, CEC Bank is independently meeting its minimum requirement for own funds and eligible liabilities (MREL) by issuing bonds under a medium-term note (MTN) programme approved by Luxembourg’s financial regulator, the Commission de Surveillance du Secteur Financier (CSSF).

In December, it issued €300mn in senior non-preferred unsecured bonds on the Bucharest Stock Exchange (BVB), carrying an annual interest rate of 5.625%. These bonds, part of the MTN programme, had been listed on the Luxembourg Stock Exchange since November 2024.