The constant growth of the banking sector's concentration shows that competition between banks is intensifying - INCE.
The National Institute for Economic Research (INCE) states that despite the difficulties of the last years and the impact of the pandemic, the banking sector in Moldova remains stable. In 2021, there were 11 banks operating in the market, including 5 that are members of international financial groups. The banking system remains highly concentrated and, compared to previous years, the concentration of the 4 largest banks in terms of assets, loans and deposits has increased. At the same time, according to the Herfindahl-Hirschman Index (HHI), if the degree of concentration of assets is considered moderate, then by the level of concentration of loans and deposits - the banking sector is excessively concentrated. According to experts' calculations, the asset concentration index rose from 1761.9 points in 2020 to 1870.6 points in 2021. The share of total assets of the four major banks rose from 78.4% to 80.1%. The highest level of assets is concentrated in Moldova-Agroindbank - 31.4% (29.3% in 2020), Moldindconbank - 20.6% (20.5%), OTP Bank - 14.2% (13.8%), Victoriabank - 14% (14.8%). The rate of concentration of other banks remained unchanged or decreased: the share of assets of ProCredit Bank on the market decreased - from 4.8% to 4.4%; Eximbank - from 4.4% to 4.1%; BCR Chişinau - from 2.9% to 2.3%; Energbank - from 2.8% to 2.5%; and the share of assets of FinComBank (3.7%), Comertbank (1.7%) and EuroCreditBank (1.3%) remained at their last year levels. HHI by the volume of loans rose from 1962.2 to 2049.8 points over the year, while the concentration level of four large banks rose from 79.1% to 80.7%. At the same time, the share of maib bank (from 34.2% to 34.9%) and Moldindconbank (from 17.9% to 20.4%) rose, while the share of OTP Bank (from 16.9% to 16.2%) and Victoriabank (from 10.2% to 9.2%) reduced. Here are the shares of small and medium-sized banks on the loan market in 2021: ProCredit Bank - 6.1% (-1 p.p.), Eximbank - 3.5% (-0.1 p.p.), FinComBank - 3.1% (-0.2 p.p.), BCR Chişinau - 2% (-0.1 p.p.), Energbank - 1.8% (+0.1 p.p.), Comertbank - 1.8% (-0.1 p.p.), EuroCreditBank - 1.1% (-0.1 p.p.). The index of HHI by the volume of deposits attracted by banks in 2021 also increased from 1832.3 to 1930.5, while the concentration level of four large banks has increased from 80.6% to 82%. The 4 large banks increased their shares in 2021 in the segment of deposits: maib - from 30% to 31.7%, Moldindconbank - from 20.7% to 21% and OTP Bank - from 14.8% to 15%, while the share of Victoriabank reduced from 15.1% to 14.3%. The share of Eximbank by the volume of attracted deposits last year was 3.9% (-0.1 p.p. over the year), ProCredit Bank - 3.6% (+0.1 p.p.), FinComBank - 3.5% (-0.1 p.p.), BCR Chişinau - 2.4% (-0.5 p.p.), Energbank - 2.4% (-0.2 p.p.), Comertbank - 1.5% (no change), EuroCreditBank - 1.3% (-0.1 p.p.). // 20.04.2022 - InfoMarket.
