The volume of new loans extended by Moldovan banks has increased by 26.1%% in the third quarter of 2019 compared to the third quarter of 2018 as the interest rate on new loans has increased insignificantly to the level of 8.16%, commented Octavian Armaşu, the governor of the Moldovan central bank, BNM.
The relative stabilisation of the average interest rates for new loans and deposits during the last six quarters creates a predictable financial climate in the medium term, which is supportive for economic growth in the future, he added.
After a period of almost three years of stagnation, the population has begun to borrow more from banks consumer loans and mortgages.
According to experts, developments in this regard have been determined by the fact that in the last year the lending interest rates are historically low, varying between 7% and 10%. In addition, the central bank claims that it has created conditions to stimulate lending to the companies as well, in national currency, to reduce systemic risks for the country's economy.
Retail lending still dominates banks’ activity, though. "Consumer loans and mortgages are the fastest growing loans in the last year, this is determined by the fact that we actually have historically low minimum loan rates, around 8-10%, for local currency loans. If we talk about the rates for the mortgage loans under the First House programmes, the rates are even lower — around 7-8%,” said Eugen Ghiletchi, economist at the Expert-Grup think-tank. However, it is “healthier” for the economy when more loans are granted to legal entities because they create larger and more intense economic activity, he added.
In the first nine months of the year, the country's financial and banking institutions granted new loans worth nearly MDL17bn (€870mn), up 29% over the same period last year. MDL7.3bn were loans expressed in foreign currency, the same level as in the same period last year.
Kazakhstan is suing New York financier Daniel Chapman and Argentem Creek Partners where he serves as CEO, alleging he conspired with Moldovan businessman Anatolie Stati to fraudulently secure an ... more
The no-confidence motion filed by the pro-EU Party of Action and Solidarity (PAS) and Dignity and Truth Platform Party (PPDA) was supported by only 46 of the 101 MPs on July 20, therefore, the ... more
The Public Property Agency (APP) of Moldova has terminated the contract with Avia Invest regarding the concession of Chisinau International Airport due to its non-compliance with the investment ... more