Four years after banking fraud, we have more questions than answers, “Expert-Grup”

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12:17, 13 Nov 2018

Four years after banking fraud, we have more questions than answers, “Expert-Grup”

Four years passed since the state decided to guarantee the emergency loans provided by the National Bank of Moldova to insolvent banks and more questions appeared yet as to the phenomenon known as “the theft of the US$ 1 billion”. Even if the unfavorable regional economic conjuncture was invoked, the crisis of 2014 was the result of a huge theft of money from three banks, says a report by the Independent Think Tank “Expert-Grup” that is quoted by IPN.

According to experts of the Think Tank, the lack of coordination between the state institutions, defective combating of money laundering and political disputes existing at that moment were the elements that led to the robbing of the three banks and the stealing of over 13 billion lei. Later the government made the 30% decline in the purchasing power of the leu and the liquidation of the three banks, one of which was state-owned, the people’s burden.

The economists of “Expert-Grup” said the banking fraud generated indirect costs that led to the slowdown of economic activity and deterioration of the investment climate. Even if a series of reforms aimed at strengthening the banking sector’s resilience and at preventing the repeat of such events were later launched, the lack of consistency between different legal acts points to the existence of possible risks posed by the use of public funds for saving the insolvent banks.

Economist and co-author of the report Eugen Giletski said the direct damage sustained by the state budget after the emergency loans were provided was assessed at 13.3 billion lei in bonds. Since the guarantee was converted into a public debt, 1.4 billion lei was paid. The efforts made to settle the debt that derives from the banking fraud before time are insufficient. This would diminish the pressure faced by taxpayers. There is no clarity as to the revenues earned from the sale of the shares that were blocked and later annulled by the central bank.

“Amid reforms, the risk taken after using public funds to save the insolvent banks diminished considerably, but wasn’t fully eliminated. Inconsistencies continue to exist between the normative documents regarding the provision of emergency loans by the National Bank of Moldova to the three banks,” says the report. The economists reiterate the importance of swifter recovering the stolen funds and paying the debt in advance as its servicing will continue to increase in value during the next few years.

12:17, 13 Nov 2018
Official exchange rate for date 14.11.2018
[T] Currency Code ABR Rate Exchange Rate Albanian lek 008 ALL 10 1.5372 Armenian Dram 051 AMD 10 0.3486 Australian Dollar 036 AUD 1 12.2605 Azerbaijanian Manat 944 AZN 1…
05:00, 14 Nov 2018

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