OREANDA-NEWS. August 06, 2013. As it was informed by the National Bank of Moldova, the decline is due to the increase in expenditure to pay interests by 20.8% as well as decrease in non-interest income by 4.3%. The net profit of banks in Moldova in June amounted to 28.9 million lei.

According to the National Bank, as of late June 2013 TIER I amounted to 7 billion 364.5 million lei, 6,6% up since the beginning of the year. The rate growth is due to larger profitability of the sector in I half-year and issue of the bank shares. TIER I reflects the ability of banks to cover potential losses in emergency situations without prejudice to financial security.

According to the National Bank, as of late June 2013, all banks of Moldova, except one, possess TIER I capital corresponding to the minimum capital ratio (200 million lei and more). The share of foreign investment in the banking capital as of late June 2013 amounted to 75.1%, increasing since the beginning of the year by 3.4 percentage points. The dynamics was due to growth in investments of non-resident shareholders by 15.5% and reduction in investments of local shareholders by 3.2%.

The average capital adequacy on the system still remains at a high level and makes 23.3% at the minimum required level of 16%. For many years it proves banking lending capacity in conditions of financial stability.

According to International Financial Reporting Standards, the total assets of the banking system of Moldova as of June 30, 2013 amounted to 63 billion 516.2 million lei, 9,2 % up since the beginning of the year and indicate a continuing trend of expansion of banking activity. According to the National Bank of Moldova, in structure of assets loans and accounts receivable in I half of 2013 increased by 9.2% - up to 39 billion 557.7 million lei, cash and cash equivalents by 13.4% - up to 16 billion 228,8 million lei, tangible assets by 16.4% - up to 1 billion 973.5 million lei, financial assets available for sale by 104.8% - up to 379.3 million leis and financial assets for sale - 29.8% - up to 442.5 million lei.

At the same time, other assets decreased by 30.6% - up to 603.1 million lei, non-current assets- by 29.5% - up to 512.7 million leis, investments held till repayment-by 0.5% - up to 3 billion 390,8 million lei and intangible assets- by 2.3% - up to 246.3 million lei. As of late June this year, balance of loans amounted to 37 billion 756.6 million leis, increasing by 7.9% reflecting dynamics of the lending process.

The quality of loan portfolio has also improved. Thus, bad loans (substandard and doubtful) in absolute terms decreased by 5.6% - up to 4 billion 790.7 million lei, while the share of bad loans in total regulatory capital declined by 7, 5 percentage points, reaching 18.4% as of late June 2013

The volume of new loans provided by Moldovan banks in January-June 2013 increased by 2.7% compared to the same period in 2012 and amounted to 13 billion 397 million lei. The volume of new deposits decreased by 20.4% - up to 16 billion 073.1 million lei. Amount of ten largest net debts on loans amounted to 23.4% of all net loans in the sector with maximum indicator - 30% of the total net loans. Return on assets and equity as of June 30 2013 made 1.6% and 9.3%, respectively, decreasing by 0.8 and 5 percentage points.

Coefficient of long-term liquidity in the banking system of Moldova made 0.8 at the maximum allowable level of 1. Current liquidity in the system was 31.2% at the minimum level of 20%. These indicators of liquidity indicate the presence of adequate funds to support relevant payments and define a high degree of banking stability against possible external shocks. According to NBM, as of late June 2013 the balance of deposits amounted to 43 billion 613.3 million leis, 9,7% up since the beginning of the year. At the same time deposits of individuals increased by 6.7% - up to 27 billion 189.5 million lei and reflects their confidence to the banking sector.