Paper in PDFIulia LUPU, PhD, Financial and Monetary Research Centre “V. Slavescu” Romanian Academy, Romania
Recent events recorded in the banking sector of the Republic of Moldova – establishing special administration in three commercial banks by the National Bank of Moldova (NBM) – have highlighted the significant role which the quality of corporate governance presents for banking system. The aim of this paper is to identify the challenges of corporate governance for the stability of the Moldovan banking system and destabilizing effects of weak corporate governance structures within banking institutions and analyze the consequences of corporate governance deficiencies. For achieving the goal the author conducted a detailed analysis of normative acts regulating the banking system in order to identify the existing gaps regarding this subject and analyzed recent performances of commercial banks in Moldova. Despite some progress in addressing the recommendations of the International Monetary Fund (IMF) and the satisfactory reported performance of banks, there are serious governance problems in several banks including the largest ones.