“It is an event aimed at warning the banks how important this reform is and how decided the National Bank is to accelerate its implementation,” the central bank’s governor Dorin Dragutanu said in the “Basel II” conference staged by KPMG Moldova in Chisinau on May 15, IPN reports.
“The international crisis of 2007- 2009 showed how close the banks are to the taxpayers that had to go through periods of sacrifice, while the states had to make great effort to be able to save the banks in difficulty. This fact determined the formulation of new principles that would contribute to the better quantification of the banks’ exposure to risks and the avoidance of the collapse of banks or bank systems,” stated the governor.
He also said that the banks in Moldova implemented the Basel I principles launched by the Basel Committee for Bank Supervision of Switzerland 15 years ago.
In the conference, Cezar Furtuna, a partner of the KPMG financial services in Romania and Moldova, made a presentation of the Basel II capital agreement, explaining the main notions of the three pillars on which it is based: minimum capital requirements, revision process, and presentation requirements. Though the capital adjustment coefficient was maintained at the level of 8%, as in Basel I, the new agreement implemented in 2004 brought about substantial changes concerning the assessing of credit risks, and introduced market discipline requirements.
Angela Manolache, consultancy director at KPMG in Romania and Moldova, referred in detail to the Basel II Pillar 1 concerning capital requirements. She enumerated the main risks that must be assessed, the approaches to credit risks, the COREP reporting requirements and the experience of the Romanian banks that implemented the Basel II agreement.
The presentation was closed by Cezar Furtuna, who explained the requirements related to Pillars 2 and 3.
Former National Bank governor Leonid Talmaci, who heads the Association of Banks of Moldova, said in an interview that the Moldovan banks will implement the Basel II principles because they convinced themselves of the effects of Basel I, which made them more resistant to different regional and global crises. The implementation of Basel II involves costs for forming risk funds and improving the supervision activity, but these costs must be incurred.
KPMG Moldova is a Moldovan company that is a member of the network of independent firms affiliated to the Swiss KPMG International Cooperative.
