The discussion took place during the first international conference entitled ‘From Mortgages to Markets: Building Long-Term Housing Finance’. It brought together representatives from government bodies, central banks, international financial institutions, as well as the banking sector and the investment community.
Participants analysed European and international experience in the field of covered bonds, explored opportunities for their capitalisation in Moldova, and identified practical solutions for the market’s development.
Benefits of developing the covered bond market
Covered bonds are securities issued by banks and backed by a portfolio of relevant assets, in particular mortgage loans, which provide investors with additional safeguards.
The development of this market could help strengthen the banking sector’s capacity to finance home purchases, diversify investment instruments and deepen the capital market in Moldova.
For the banking sector, the development of this instrument will mean diversifying sources of funding and reducing dependence on traditional sources, as well as attracting long-term funds. At the same time, covered bonds will offer investors new opportunities for capital investment.
In the long term, the development of this market could help to expand mortgage financing and facilitate public access to loans for home purchases.
The NBM is establishing the legal framework for the instrument
During the conference, discussions centred on European and international experience in the field of covered bonds, the regulatory framework, investor protection mechanisms, the management of collateral portfolios and the conditions necessary for the development of a functional market.
A legal framework for the covered bond market is currently being established in Moldova. In this regard, the National Bank of Moldova has drafted a Bill on the Issuance of Covered Bonds and State Supervision thereof, which will lay the legal foundation for this financial instrument and bring national legislation into line with EU standards.
The draft transposes the provisions of Directive (EU) 2019/2162 and establishes investor protection mechanisms, transparency requirements and state supervision, thereby creating the necessary conditions for the development of a safe and functional covered bond market in Moldova.
The conference is organised by the National Bank of Moldova in partnership with the European Mortgage Federation – European Council of Covered Bonds (EMF-ECBC) and the Moldovan Banking Association.
This story was translated with the assistance of artificial intelligence.The translation was also reviewed by the Logos Press editorial team.
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