Moldovan banking sector’s net profit in 2020 amounted to 1.65 billion lei, down 27% (-0.6 billion lei) year on year.
The National Bank of Moldova (NBM) announced this while assessing last year’s financial situation in the banking sector. According to the NBM, the decline in profits in 2020 was largely due to an increase in non-interest expenses by 27% (+1 billion lei), mainly due to an increase in losses from the depreciation of financial assets. At the same time, interest expenses decreased by 5.7% (-0.08 billion lei) as a result of a decrease in the average rate on deposits in national currency from 4.88% as of December 31, 2019 to 3.96% as of December 31 2020, and, accordingly, on deposits in foreign currency - from 1.02% to 0.72%. At the same time, non-interest income increased by 16.3% (0.48 billion lei), mainly due to an increase in income from exchange rate differences by 0.32 billion lei (+ 33.8%). At the same time, interest income decreased by 3.1% (-0.1 billion lei) due to a decrease in the average rate on loans in the national currency from 8.08% as of December 31, 2019 to 7.66% as of December 31, 2020 and in foreign currency - from 5.09% to 4.90%. At the same time, the average interest rate on government securities decreased from 6.4% to 5.01%. The total revenues of banks in 2020 amounted to 7.8 billion lei, increasing by 0.34 billion lei (+ 4.6%), compared to the previous year. At the same time, in the structure of income, the share of interest income was 56% (4.4 billion lei), and non-interest income - 44% (3.4 billion lei). At the same time, their total expenditures amounted to 6.2 billion lei, having increased versus 2019 by 0.9 billion lei (+ 18.3%). At the same time, interest expenses amounted to 1.3 billion lei (21.4% of the total), and non-interest expenses - 4.8 billion lei (78.6% of the total). According to the National Bank, the return on assets and return on equity as of December 31, 2020 amounted to 1.7% and, accordingly, 9.6%, having decreased by 0.8 percentage points and 5 percentage points, respectively, relative to the situation as of the end of the previous year. // 19.04.2021 - InfoMarket
