BUCHAREST, Jan 30 (Reuters) - Romania's central bank governor warned on Friday that the same "moral hazard" risks attached to home owners borrowing in Swiss franc-denominated loans could spread to euro loans if policymakers offered unrealistic solutions to the franc's surge.
Hundreds of thousands of people across Central and Eastern Europe took out loans denominated in Swiss francs in the 2000s despite warnings from economists and policymakers, including from the Romanian central bank. The borrowers were attracted by lower interest rates than those offered in local currencies.
Mortgage payments are set to soar since the Swiss central bank abruptly removed the cap on the currency earlier in January, although the impact is expected to be lower in Romania than in some of its wealthier neighbours. (Reporting by Luiza Ilie; Writing by Matthias Williams; Editing by Robin Pomeroy)