Alexandru Petrescu, President of the Financial Supervisory Authority (ASF), assesses that the insurance market, the capital market, and the private pensions market, under the Authority’s supervision, have operated based on internal adaptation mechanisms, demonstrating structural maturation beyond cyclical fluctuations.

How Romania’s non-bank financial markets resisted in a year of fiscal adjustments and macroeconomic pressures

In Romania, 2025 was characterized by structural tension between the need for budgetary adjustment and maintaining the smooth functioning of the real economy. Although the main fiscal measures were concentrated in the last quarter of the year, public debate and signals regarding deficit correction influenced economic agents’ expectations throughout the entire year. These developments overlapped with an international context marked by geopolitical and financial uncertainties, particularly from the US economy and global capital markets, shaping an economic climate with rising financing costs and a fiscal framework perceived as unstable, with impact especially on small and medium-sized enterprises.

Nevertheless, the developments of the three markets supervised by ASF—private pensions, insurance, and the capital market—were positive overall, indicating a capacity for adaptation and solid functioning in a complex economic and fiscal context.

Capital market: performance and maturation

The capital market emerged as one of the positive vectors of the non-bank financial landscape. Index performance reiterated the growing attractiveness of the Bucharest Stock Exchange, with BET up +27.61% as of September 30, 2025 compared to the end of 2024 and BET-TR reaching approximately +34.32%, signaling sustained appetite for equity exposure and total returns. Liquidity increased in value, with 31.23 billion lei traded on the Regulated Market and SMT in the first nine months, 22.57% above the similar period last year.

The transaction structure indicates a visible orientation toward government securities and non-governmental bonds. From a risk perspective, Q3 2025 brought clear normalization, with reduction of systemic tensions and contagion dropping to lower levels in the summer months, in a climate explicitly defined by lower correlations and reduced systemic risks. This mix supports the hypothesis of a more stable volatility regime for Q4, in the absence of external shocks.

On the primary market, continuity was the key element, with public purchase offers of approximately 866 million lei and bond issues admitted to trading worth about 931.87 million euros. Instrument diversification deepened through new issuers, structured products, and sustainable financing, including a sustainable bond issue of 1.5 billion lei and a green bond issue of 500 million euros also listed internationally.

The expansion of the investor base confirmed market maturation. The number of accounts increased by 27% compared to the end of 2024, from 226,000 to nearly 300,000 at the beginning of 2026.

Insurance: between growth, prudence, and the role of intermediaries

The insurance market continued to record positive dynamics in 2025, with total underwriting volume reaching approximately 18.7 billion lei in the first nine months, up 11%. The evolution was mainly supported by companies authorized and supervised by ASF, while branches recorded a moderate advance of 3%. The MTPL segment remained dominant, with premiums underwritten of about 7.6 billion lei, also up 11% compared to 2024.

Solvency indicators remained comfortably above minimum requirements, with a solvency capital requirement coverage ratio of 165% and minimum capital requirement of 390%, relatively stable compared to the previous year. At the same time, a slight decrease in liquidity was observed, determined by the faster growth of short-term obligations compared to liquid assets. Technical reserves reached 25.1 billion lei at the end of Q3 2025, up 17% annually, confirming their role as a pillar of financial stability.

Claims payments increased by 16%, to 8.9 billion lei, and investment portfolios remained predominantly oriented toward fixed-income instruments, especially government bonds, which represented 63.5% of the total.

The role of intermediaries remained essential in the distribution of insurance products. The value of premiums distributed by brokerage companies for insurers authorized by ASF and for branches active on the Romanian market stood at 12.6 billion lei at the end of September 2025, up approximately 9% compared to the same period in 2024. In the first nine months of the year, brokers intermediated about 67% of the total volume of gross written premiums, with the intermediation rate being 81% for general insurance and 13% for life insurance, highlighting the high dependence of the general insurance segment on indirect distribution channels.

Private pensions: consolidation in a volatile context

The private pension system offered one of the clearest pictures of long-term stability. At the end of September 2025, total assets of Pillar II and III reached 190.9 billion lei, up 23% compared to the same period in 2024 and representing 10.3% of GDP. The number of participants rose to 9.36 million, with visible expansion in both Pillar II and Pillar III.

Contribution flows supported this growth, with 16.7 billion lei transferred to Pillar II in the first nine months, 27% above the 2024 level, and a 44% increase in new participants in Pillar III. Portfolios remained prudent, with approximately 70% of assets placed in fixed-income instruments and 25% in equities, but returns were competitive, with Pillar II’s average return rate rising to 8.15% in September 2025.

With volatility returned to a moderate level after the temporary shock in May and with a predominantly local investment structure, the premises for Q4 2025 indicate a continuation of the growth trend and a gradual consolidation of Pillar III. In a year dominated by fiscal adjustments and macroeconomic uncertainty, private pensions functioned as a barometer of long-term confidence, confirming that stability is built through slow, disciplined, and consistent accumulations.

Viewed as a whole, developments in 2025 show that Romania’s non-bank financial markets navigated relatively well through a year marked by fiscal adjustments and macroeconomic uncertainties. Despite pressures related to budgetary consolidation, high financing costs, and external volatility, the capital market, insurance sector, and private pension system continued to function coherently, attract resources, and support long-term savings. This resilience reflects the existence of institutional mechanisms that, when properly calibrated, can contribute to shock absorption and stability maintenance even during periods of economic adjustment.

Source: https://studiifinanciare.ro