NO ONE FORECASTS MOLDOVAN BANKING SYSTEM COLLAPSE - NBM PRESIDENT

Neither in Moldova nor outside there is anyone talking about collapse of separate banks or of the Moldovan banking system in general, maintains National Bank of Moldova President Sergiu Cioclea.

In the banker's interview to the Banks & Finances Magazine, the NBM head said that the level of trust in banking system has considerably grown in many respects.

"Even if we did not achieve the level we had before the banking scandal, this is remarkable in itself and rewards NBM efforts on improving the quality of bank portfolio, strengthening of the shareholders capital foundation and raising of property structure transparency", Cioclea said.

According to him, the banks correctly perceived the "spirit of the age" and started to actively implement changes for improving the internal procedures, strengthening the corporate management agencies, the supervision system, the risk monitoring, general principles of crediting and bailiff insurance.

"In this way, against the background of high rates of capitalization (31% at the norm of not less than 16%) and the current liquidity (55% at normative of not less than 20%), banks are not just financially, but also morally proved to be ready to implement new rules of banking regulation Basel 3", the banker said.

Answering to the question what banks have to do by the end of 2018, the NBM President said that they should adapt operational systems for transit to new Basel 3 rules.

"They also have to revise business models in conditions of the newest challenges. The new rules of credit risk accounting, surplus of deposits on accounts, fast development of informational technologies and nonbank crediting channels, arrival of foreign banking groups to the domestic market; everything suggests that the "business as usual" is doomed to failure", Cioclea said.

He maintains that in the period of the conducted reforms, the solidarity of shareholders and managers is very important for banks.

"At reformatting the banking activity, the bank, from which shareholders want just to take dividends, will not be able to preserve profitability and market positions for long. In this connection, smaller banks should think about the possible synergy from merger with other market players, while large banks - about investments in IT, as an answer not only to technological challenges, but also to the personnel crisis in the country", the NBM President maintains.