The banking system in 1989 consisted of the National Bank of the Socialist Republic of Romania (known as the National Bank), the Investment Bank, the Bank for Agriculture and Food Industry, the Romanian Foreign Trade Bank, and the Savings and Consignation Bank. In addition, a centralized Hard Currency Fund was set up in January 1988 to supervise all transactions involving hard currencies and to control the use of hard-currency earnings to finance imports. The new body included representatives of the National Bank, the Foreign Trade Bank, the Ministry of Finance, and the Ministry of Foreign Trade.

Established in 1880, the National Bank was the heart of the banking system. It issued the national currency, set exchange rates, monitored the flow of money, managed budgetary cash resources, coordinated short-term credit and discount activities, and participated in the formulation of annual and five-year credit and cash plans in cooperation with the State Planning Committee and the Ministry of Finance. All industrial, transportation, and domestic trade enterprises maintained accounts in the National Bank. The bank also controlled the production, processing, and use of precious metals and gems and had exclusive authority to purchase from individuals items made of precious metals or stones and items of artistic, historic, or documentary value.

The Investment Bank, established in 1948, was the conduit by which investment resources--including state budget allocations-- were directed to individual state, cooperative, consumercooperative , and other public organizations except for foodindustry and agricultural enterprises. With hundreds of affiliates throughout the country, the Investment Bank adjudicated loan applications from enterprises and granted long-term investment credit after verifying that the money would finance projects consistent with the national economic plan. The bank reviewed technical and economic investment criteria and evaluated the feasibility of proposed investment projects on the basis of accepted standards. In theory, it approved only investment projects that satisfied all legal requirements regarding need, suitability, and adherence to prescribed norms had an adequate raw materials base and assured sales outlets and served to improve the economic performance of the organization undertaking the project. The bank also granted short-term credit to construction enterprises and to geological prospecting and exploration organizations. The Investment Bank was responsible for calculating capital depreciation allowances to be paid by the central government to the accounts of individual enterprises.

The Bank for Agriculture and Food Industry was created in May 1971 by expanding the functions and changing the name of the Agricultural Bank established three years earlier. The bank provided investment and operating credits for food-industry enterprises, state and cooperative farms, and private farmers and financed the distribution of agricultural products within the country.

The Savings and Consignation Bank, originally called the Savings and Loan Bank, held the sav77c avings and current accounts of individual citizens. The bank mobilized the cash resources of the population for investment through obligatory periodic transfers of deposited funds to the National Bank.

The Romanian Foreign Trade Bank was established in July 1968. In 1987 its deposits totalled nearly 168 billion lei. The bank collaborated with the Ministry of Finance to obtain and manage foreign credit, and it handled transactions in both foreign currencies and lei for import and export services and tourism. Through strict control of hard-currency allocations, the bank encouraged the substitution of domestic products for imports.

In 1972 eight French banks joined the Foreign Trade Bank in setting up the Paris-based Banque Franco-Roumaine, which had a founding capital of 20 million francs. Later that year, the AngloRomanian Bank with a founding capital of US$7 million was established in London. And in 1976, the Frankfurt-Bucharest Bank AG, with a founding capital of DM20 million was set up in Frankfurt.

Data as of July 1989