ANTICIPATION OF BANK FAILURES IN THE REPUBLIC OF MOLDOVA

Abstract

The excessive risks taken by the banks resulted in banking crises, that caused the collapse of large financial institutions and even global recession. The main scope of this paper is to identify the causes, consequences, and methods of anticipating bank failures at national and international levels. The proposed scope is materialized in the following research task: identifying the ability of the National Bank of Moldova (NBM) to influence the local banks, as well as analyzing the legal framework regarding bank recovery and resolution. The research theme results from the necessity to maintain a stable and reliable banking system in order to ensure the continuity of financial intermediation, protect the depositors’ interests and contribute to the development of a strong economy. The value of the investigation is determined by the practical relevance of the study carried out, as well as by the recommendations contained in the paper, the implementation of which will contribute to streamlining the prudential supervision of the domestic banking system, preventing bank failures in future and ensuring the financial stability of the banking system in the Republic Moldova.