Moldovan government approves draft law on consolidating banking system

Chisinau, 22 June /MOLDPRES/ - The cabinet, at a today’s meeting, approved a draft law on the adjusting of the law on financial institutions and law on state registration of legal entities and private entrepreneurs, the government’s communication and media relations department has reported.

The amendments proposed aim at consolidating the National Bank of Moldova (BNM), ensuring enhanced powers of supervision and control in terms of commercial banks, and the commercial banks will be obliged to prove more transparency.  

The document sees, inter alia, getting a permission from BNM to purchase and subscribe commercial banks’ shares and giving the Central Bank right to establish special management, in case BNM ascertains a concerted action of shareholders, who hold a quota higher than 50 per cent of the registered share capital, without the National Bank’s agreement. The aforementioned draft also gives BNM right to establish, by regulations, audit activities at banks, on other purposes than the ones presently provided for by the legislation and extending the deadline of the process of liquidating banks from 3 to 5 years.

Authors said that the concerned amendments would ensure the development of a sound corporate governance, in line with the international principles. These amendments are aimed at strengthening the national legal framework on the transparency and quality of the banking shareholders, corporate governance and risks management in the banking system. At the same time, the scheduled amendments will allow approximate the national legislative framework to the European one, in the context of the commitments assumed by Moldova according to the Association Agreement with the European Union.

(Editor A. Raileanu)