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bne October 2019 Companies & Markets I 15
as saying on September 18 that the government has grown impatient with the lack of progress on bad debt, clogged credit channels and an unwillingness by banks to write off loans. It planned to take a more aggressive stance on the matter, the person added.
The BDDK said Turkish banks’ capital adequacy ratio (CAR) would slip by 50 bp to a still high 17.7%. That would be due in part to the instruction on NPLs, according to what the regulator described as a “prudent” analysis based
on July data.
In a statement, the watchdog added that lenders have raised cash over the last year, with core and secondary capital rising by TRY49bn.
Moldovan banks
close accounts of key Transnistrian companies
Iulian Ernst in Bucharest
Major companies in Moldova’s pro-Russian separatist republic of Transnistria were instructed by legitimate banks in Moldova to close their accounts on September 5, which will impede their operations, particularly their foreign trade activity.
This was just intended to increase transparency, Moldova’s central bank said, but the move is likely to severely impact key Transnistrian companies.
At present there are only three banks in Transnistria, controlled either by the authorities or by the Sheriff group that dominates the separatist region’s economy. They can carry out external operations in dollars or euros through correspondent accounts opened in banks in Russia or Austria. But they are blacklisted by the US authorities, meaning their operations in US dollars are subject to screening and certain restrictions. Also they can do operations in Moldovan lei through a clearing house opened in Tiraspol by the National Bank of Moldova (BNM).
The BNM explained that Moldovan banks are only adjusting to international regulations against money laundering
and terrorism financing, and not all the 400 Transnistrian
“Studies conducted show that the industry as a whole maintains its healthy and strong structure and the standing capital structure is at a level that can easily manage asset quality-based risks,” it said.
The BDDK previously estimated that the banking sector’s NPL ratio could rise to 6% by the end of 2019, Some analysts have calculated higher estimates.
Turkey’s currency crisis caused inflation and interest rates
to soar and pushed the economy into recession. The TRY weakened by almost 30% against the USD last year. It is down another 7.8% this year to date. With inflation officially falling, the central bank has embarked on an aggressive easing cycle. It has cut its benchmark rate by 750 bp in the past two months.
The central bank of the Republic of Moldova. Shutterstock.com
companies with accounts in Moldova were denied the right to hold an account.
Transnistria reported that 25 companies, including large ones, have already closed their accounts.
"On September 5, a Moldovan commercial bank blocked all operations related to the accounts held by several Transnistrian companies. The companies were notified to close their accounts. Thus, the Transnistrian importers are not able to purchase goods and to conduct operations with foreign partners,” informed the Transnistrian state news agency Novostipmr.com. The central bank in Transnistria reports that the problems have started since the beginning of the summer, immediately after the change of leadership in Chisinau, thus suggesting that the former government in Chisinau had not created such problems.
"Since June 2019, requests have been received from the Moldovan commercial banks for the Transnistrian companies to close their accounts. These requests lacked proper explanations. Companies have sought to open accounts in other commercial banks but since September 5, these actions, in our opinion, have acquired a systemic character,” said Alexei Melnik, the first vice- president of the central bank in Transnistria.
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