Parliament passes new law on banks' work in Moldova

Chisinau, 6 October /MOLDPRES/ - A draft law on the work of banks was adopted by the parliament in the final reading today.

The new law will replace the law on financial institutions and will create a new legislative framework related to the activity of the banks of Moldova. The law will allow efficiently supervising the banking institutions from Moldova and development of instruments of supervision for the prevention and minimizing eventual deficiencies in the banks’ work, at initial stages.

The draft passed by the MPs provides for the creation of a framework of corporate governance in banks and introduction of a string of new requirements for the assessment and quantifying the risks by the banks. Besides, the draft will generate approximation of the national banking legislation to the international standards and principles.  

The new law stipulates the extension of rights and powers of the National Bank of Moldova (BNM) in the process of assessment and supervision of banks, including the increase and diversifying the sanctions applied to banks. Another novelty regards the bank’s compulsoriness to have an adequate internal capital in relation to the risks it is exposed to. At the same time, the law includes new concepts and notions, among which the change in the sense of the notions of “branch.”

The law also sets a switch to the banking system according to the principles BASEL III through adjusting to the European Union’s legislation. The law was worked out within a twinning project, financed by the European Union, and will  enter into force on 1 January 2018.  

(Reporter A. Zara, editor A. Raileanu)