On Wednesday, Bucharest hosted the forum “Moldova – Romania: capital Bridges”, attended by the prime ministers of the two countries, the governor of the National Bank of Moldova, Anca Dragu, other high-ranking officials, heads of capital and financial markets regulation and supervision authorities, as well as business representatives from the Republic of Moldova and Romania.
The main talking point was legislation harmonization between the Republic of Moldova and the European Union which would pave the way for the interconnection of capital and financial markets. Important steps have already been taken in this regard, but intensive work continues with very good results, as outlined by all speakers at the event.
One of the effects of this collaboration will be the increase of the number of companies from Moldova to be listed on the Bucharest Stock Exchange. This concerns, among others, the largest financial institution beyond the Prut river, Maib Bank, which is undergoing preparations for listing on the BSE.
According to Anca Dragu, governor of the National Bank of Moldova, harmonizing national regulation with that of Europe is an essential pillar of interconnecting capital and financial markets in Moldova and Romania, a step that will mark the integration of the capital market in Moldova with the international financial market.
“I was speaking about the effort to stick to macroeconomic landmarks, to the objectives of the National Bank of Moldova operating law, but I can tell that we are looking into financial stability, banking supervision and capital market infrastructure. We recently completed a twinning project (the consolidation of supervision, corporate governance and risk management in the financial sector – e.n.) together with three central banks in the European Union, the Bank of Lithuania, the Bank of the Netherlands and the National Bank of Romania. Moreover, together with FSA, providing us with very valuable supports concerning the regulation and supervision of the insurance market, and I thank president Alexandru Petrescu, who coordinated this support from our colleagues in Bucharest, we were able to complete an extraordinary project through this twinning program, alongside our colleagues from the National Bank of Romania, namely the file of becoming part of the SEPA single payment system in euro and, also together with colleagues from the National Bank of Romania, we completed the instant payments program, which is already operational in Chişinău”, stated Anca Dragu.
The head of the NBM believes that the diversification of financial instruments and funds accumulation mechanisms contributes decisively to capital market dynamism.
“And here we have a good collaboration with the capital markets regulator. We have special opportunities to develop this market and I would quote the governor of the National Bank of Romania, Mr. Mugur Isărescu, who said, for instance, that listing Hidroelectrica at such a magnitude as that of the summer of 2023 would have been inconceivable on the Stock Exchange a few years ago. This was mentioned, but not why that is. Because private pension funds accumulations have emerged in the meantime, which is another area where the Republic of Moldova has great potential and concrete plans”, added Anca Dragu.
Joint projects with experts from Romania
The fundamental institutions that will allow capital market development in Moldova are subsequently created. The head of NBM mentioned some of the projects carried out with the support of Romanian institutions:
“We are completing the Central Depository development strategy, which is under the coordination of the National Bank of Moldova, along with other important elements. The strategy takes into account two key aspects: the establishment of connections between the Depositary in the Republic of Moldova and the one in Romania, and the transition to the omnibus segregation model of investors, which will expand the possibilities of intermediaries. We are currently examining the possibility and finding the measures to reduce risks connected with the increase of this share of holdings from 1% to 5%, a very important step towards market development. We fully understand that we must assess the risks and find the correct and effective measures to diminish these risks. Doing nothing is the worst thing. We must do, do responsibly and professionally. Our vision is for the Republic of Moldova to become a respected and valued player on the international financial market – and we have those from whom we can learn. We thank BSE, we thank FSA, we thank NBR”, added the governor of the NBM.
“We are benefitting from a favorable macroeconomic context and we are proud to say that inflation in the Republic of Moldova dropped to a little over 4%, which has allowed us to reduce the monetary policy rate to 3.75% and placed us comfortably on the inflation target corridor”, stated Anca Dragu.
Republic of Moldova prime ministers: Interconnecting capital markets is an opportunity for both countries
“Interconnecting capital markets in the Republic of Moldova and Bucharest is not an easy project. All institutions must be prepared. We believe that there are many good assets in Moldova that must be exposed to international financial markets and that international markets can be used to finance projects in Moldova, in infrastructure, energy and various public-private partnerships”, mentioned Dorin Recean.
According to him, interconnecting capital markets in the two countries is an opportunity for regional expansion for companies from the Republic of Moldova.
“The Republic of Moldova has a fiscal budget policy oriented towards the business environment. The Republic of Moldova respects profit. The Republic of Moldova wants companies’ profitability to increase. This will lead to much higher productivity in the economy”, added the prime minister of the Republic of Moldova.
The President of the FSA: Many companies from the Republic of Moldova can be listed on the BSE
Many businesses from the Republic of Moldova are absolutely prepared to be listed on the Bucharest Stock Exchange, stated on Wednesday the president of the Financial Supervisory Authority, Alexandru Petrescu.
Alexandru Petrescu, president of the FSA, stated that many companies in the Republic of Moldova are absolutely prepared to be listed on the Bucharest Stock Exchange, businesses from the fields of critical infrastructure, telecom, energy.
“Upon visiting Moldova I had the opportunity to see many businesses that are absolutely ready to be listed on the Bucharest Stock Exchange, businesses from the fields of critical infrastructure, telecom, energy. I would not say that we are breaking the ice, because we already Purcari listed on the BSE, but a corridor of investment orientation for Moldova commercial entities is widening, which as expected and welcome on the capital market in Romania”, stated Petrescu at the second edition of the Forum Moldova-Romania: capital Bridges.
“Investors cross the river Prut and, more recently, regulators do this as well. Consequently I am honored to be in a somewhat pioneering position in terms of regulation authorities, because we recently managed to complete a 10-month project of twinning, of calibrating non-banking financial legislation in the Republic of Moldova in view of joining the European Union. We had over 26 meetings in person, 40 online meetings, tens of experts engaged from the FSA and the National Commission for Financial Markets. These were 10 months during which we managed to bring to an area of convergence with European legislation everything related to RCA, everything related to the transposition of the Solvability 2 European Directive. This project will continue since today we are working on an agreement between the National Bank of Moldova, the National Commission for Financial Markets, FSA, NBR, so that this legislative alignment effort will continue”, states the president of FSA.
The BSE listing of the largest bank in the Republic of Moldova – maib – is underway
At the same time, he mentioned that he conducted meeting with the management of the maib and that intensive work is being done to create the legislative framework that would allow a successful listing of the bank on the capital market in Romania.
“It is time for the experts to work behind the scenes on the legislation that would allow the listing of maib (the largest commercial bank in the Republic of Moldova) on the capital market in Romania. From this standpoint, we are hard at work, together with the BSE, the Central Depository, the National Bank of Moldova, the NBR, in view of creating the legislative framework that would allow a successful listing. And I have no doubt that this will occur as soon as possible. I am indeed very pleased that I am in a position to lead an effort, in a broader sense, of the state, to lead a strategy related to the homogenization of financial, banking and non-banking spaces between Romania, the European Union and the Republic of Moldova. We have moved from the agenda of good intentions to the dimension of operationalization, so we will see more and more investors, more authorities, more government entities from Romania that will make a modus operandi of traveling to Chişinău and work alongside our colleagues in the Republic of Moldova”, pointed out Alexandru Petrescu.
The Bucharest Stock Exchange is an opportunity for better visibility of companies from the Republic of Moldova
BSE president, Radu Hanga, spoke about the part capital market plays in supporting local economy, along with the financial sector, capital coming before bank loans.
“Along with the banking sector, the stock exchange is an extremely important pillar in supporting local economy and local companies. The stock exchange is always a platform that creates local champions, who have the ability to develop, to grow, to become regional champions. This is a reality we see if we look at economies that are a landmark for us. It is a reality that is beginning to take shape in Romania as well. We see things happening here as well – and we want to help our colleagues and friends in the Republic of Moldova with our expertise”, stated Radu Hanga at the second edition of the forum Moldova – Romania: capital Bridges.
He emphasized that access to capital is at least as important as access to banking loans.
“When talking about local companies development, access to capital is at least as important as access to bank credit. We know that the first question that arises for any company going to the bank to access credit is related to the capital it holds. capital comes before credit”, added Radu Hanga.
In his opinion, companies must have access to capital in order to have access to credit and develop.
“We are doing this. We are a catalyst for the further development of the banking sector. We are doing it in Romania and hope to be able to help the same thing happen in Moldova as well. On the other hand, today also demonstrates this fact. The stock exchange does not deal in capital alone. The stock exchange also concerns visibility and positioning. We say that a company listing on the stock market goes up on a stage and becomes more visible not only for its investors, but also for its clients. It is a stage displaying not only the company shares and their financial results, but also its products and services. It is a stage that helps the company grow. After all, this is what we are, exactly what we are doing today. We are happy that we are able to do this for the Romanian economy and for Romanian companies. We are happy that events like “Moldova – Romania: capital Bridges” provide us with the opportunity to share our experience”, added the president of the BSE.
On Wednesday, government high-ranking officials, heads of financial markets regulation and supervision authorities, as well as business and finance representatives from the Republic of Moldova and Romania attended the second edition of the forum Moldova – Romania: capital Bridges.
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