The National Bank of Moldova published its financial stability assessment for the second quarter of 2025, concluding that the banking sector shows an adequate level of resilience and that conditions in the financial system remain normal. The financial stress index stood at 0.38, below the stress threshold of 0.52, while the banking sector vulnerability indicator was -0.46, below the zero signal threshold, suggesting no build-up of systemic risks. Direct contagion risk was assessed as low, given that most interbank placements are held with foreign banks, and no cases of heightened sectoral credit concentration were identified. Banks’ exposure to non-bank financial institutions increased by MDL 37.4 million (1.1%) quarter on quarter to MDL 3,552.9 million (3.8% of total bank lending), with all such loans classified as performing. Survey results indicated unchanged corporate lending standards and slightly eased household standards, alongside a slight increase in credit demand; banks continued to rank geopolitical, macroeconomic and sovereign risks as the top systemic risks, with credit risk moving up in perceived importance ahead of cyber risk. New mortgage lending rose 76.9% year on year to MDL 2,798.8 million (down 1.9% quarter on quarter) and new consumer lending rose 29.8% year on year to MDL 4,405.1 million (up 22.7% quarter on quarter); household NPLs (national prudential definition) increased to 3.1%, driven largely by a MDL 283.6 million rise in non-performing residential mortgage loans linked mainly to regulatory-driven reclassifications. Residential property prices continued to rise, with the Residential Property Price Index (RPPI) reaching 222.0% (up 4.9% quarter on quarter and 33.8% year on year), and sensitivity analysis indicated mortgages would have the largest impact on capital ratios under a deterioration in credit quality, while liquidity buffers were described as solid.
National Bank of Moldova 2025-10-16
National Bank of Moldova finds the banking sector resilient with low financial stress in its Q2 2025 financial stability assessment
The National Bank of Moldova's Q2 2025 financial stability assessment shows banking sector resilience, with a financial stress index of 0.38 and a vulnerability indicator of -0.46, both below critical thresholds. Direct contagion risk is low, with increased exposure to non-bank financial institutions and stable corporate lending standards. New mortgage and consumer lending rose significantly year on year, while household non-performing loans increased to 3.1%, primarily due to regulatory reclassifications.