Anka Dragu
The transition to the euro as the primary currency did not generate an actual profit for the National Bank of Moldova (NBM), but it did yield a benefit. The strengthening of the euro provided the regulator with a positive foreign exchange gain of 50.6 million euros, which allowed it to be included in the amount of profit available for distribution.
“Exchange rate gains arising from foreign exchange transactions are subject to distribution and are included in distributable profits,” NBM management commented on the dividend amount. It also emphasized that “the transition to the euro as the base currency effective January 1, 2025, became a structural necessity that reduced costs for the public and stabilized the financial market.” At the same time, experts note that this decision was purely methodological in nature and did not imply a pegging of the leu exchange rate.
As LOGOS PRESS previously reported, last month the National Bank of Moldova (NBM) transferred nearly one billion lei (910.41 million lei) from its profits for the 2025 fiscal year to the state budget. The other half, in the same amount, was allocated to the bank’s capital.
According to the Law on the NBM, when the capital ratio is between 4% and 10%, the distributable profit is divided in equal proportions. The bank’s authorized capital thus reached 6.93% of its monetary liabilities, which consist of all NBM liabilities except those owed to the Government of Moldova and the International Monetary Fund.
Capitalization Accounting
In 2025, the Moldovan leu depreciated by approximately 2% against the euro, reaching 19.75 lei per euro as of the end of 2025, and appreciated by approximately 9% against the U.S. dollar, to 16.7925 lei per dollar.
As a result of this exchange rate change, the U.S. dollar-denominated assets held by the NBM generated unrealized accounting losses from exchange rate differences of approximately 3.7 billion lei. Meanwhile, assets denominated in euros generated unrealized accounting gains from exchange rate differences of approximately 0.8 billion lei.
In total, unrealized foreign exchange losses of approximately 2.9 billion lei were recorded in 2025.
The NBM provides a detailed breakdown of the resulting exchange rate adjustment balance sheet to explain the origin of the actual profit.
“It is determined based on accounting results, net of unrealized gains and losses arising from changes in the value of monetary assets and liabilities denominated in foreign currency, as well as precious metals, due to fluctuations in exchange rates and market prices. These items are excluded so that the profit distributed to the state budget represents only the profit actually earned and is not affected by temporary fluctuations in exchange rates or the market value of assets, which may be offset in the future,” the central bank’s explanation states.
Other financial details of the transaction are also provided. After the euro became the country’s primary reference currency on January 1, 2025, the NBM optimized its reserves by converting assets and revaluing them.
The National Bank converted 623.4 million U.S. dollars into 596.2 million euros, and the subsequent strengthening of the euro led to a gain of 50.6 million euros.
The central bank emphasized, as quoted above, that this amount is the result of an accounting revaluation of assets, not a commercial profit.
However, despite the fact that the income from the euro stems from exchange rate differences, the National Bank’s overall financial results for 2025 made it possible—perhaps for the first time in several years—to distribute profits, including to the government.
Benefits for the Public and Businesses
The private sector felt the main tangible economic impact of the transition to the euro. Thanks to the narrowing of the spread between the buying and selling rates of the European currency, Moldovan citizens and companies saved approximately 21.8 million euros.
Economist Veaceslav Ionita was the first to predict the benefits of narrowing the spread between buy and sell rates at currency exchange offices. The results of the first year and a half confirmed these estimates: the average spread on the euro fell by 24% (from 21 to 16 bani).
“This step eliminated the unnecessary costs of double conversion and reduced commercial banks’ margins,” the expert said. Ionice noted that the narrowing of the spread and the stabilization of the market bring a net benefit to Moldovan citizens who receive remittances or hold savings in euros—a benefit that previously remained with the banks as profit.
Previously, when the U.S. dollar was the NBM’s primary reference currency, any transactions involving the euro (which account for more than 60% of trade and 70% of remittances in the country) required cross-conversion via the dollar. This artificially widened the spread.
The designation of the euro as the official base currency forced commercial banks and currency exchange offices to narrow the spread between the buying and selling rates for the euro.
As LOGOS PRESS reported, this has arguably been one of the main consequences of the NBM’s decision, which for over a year and a half now has had a positive impact on both the country’s foreign exchange costs and the management of its foreign exchange reserves.
The transition to the euro as the reference currency did not change Moldova’s exchange rate regime nor peg the leu to the euro at a fixed rate. This change was technical in nature, but it directly affected the stability of the leu and reduced settlement costs.
Key Implications for the Moldovan Leu Exchange Rate
In addition to narrowing the spread (the difference between the buy and sell rates), the volatility of the national currency has also decreased, experts note. The leu’s exchange rate has become more stable relative to the euro. Previously, the EUR/MDL exchange rate was calculated via a “cross rate” against the U.S. dollar, causing the leu to fluctuate sharply in response to global movements in the EUR/USD pair. Now, however, the leu’s exchange rate reflects direct transactions with the euro.
The National Bank of Moldova does not artificially fix the exchange rate. The leu remains under a managed floating exchange rate regime, and the official rate is set daily based on actual supply and demand in the commercial market.
In addition, the methodology for calculating the exchange rate against the U.S. dollar—to which, incidentally, part of the country’s external debt is pegged—has changed. The dollar-to-lei exchange rate (USD/MDL) is now calculated via a cross-rate with the euro. As a result, the average spread on dollar transactions has increased slightly (by approximately 1 ban), but this has been fully offset by gains from euro transactions.
This has not had a significant impact on the value of the external debt. As explained by the Ministry of Finance, the external public debt continues to be denominated in various currencies (including U.S. dollars, euros, and other loans from multilateral creditors).
The change in the official reference rate has reduced the dependence of domestic exchange processes on daily fluctuations in the USD/MDL exchange rate; however, the revaluation of the debt itself in lei still depends on actual market fluctuations in global currencies.
How Much to Pay in Lei
Changes in the exchange rate affect external debt service through the direct conversion of payment amounts (interest and principal) from foreign currencies into Moldovan lei (MDL).
Since Moldova’s state budget revenues are denominated in lei, and international creditors require payments in foreign currencies (USD, EUR, SDR), the exchange rate determines exactly how much budget money will have to be spent on each payment.
If the U.S. dollar or the euro strengthens against the MDL, debt service becomes more expensive—and budget expenditures rise. To repay a fixed amount—for example, $10 million—the Ministry of Finance must allocate more lei from the treasury than originally planned. Conversely, if the dollar or euro weakens against the MDL, debt service becomes cheaper.
Current Indicators
The new methodology has become firmly established in the market. The NBM’s official exchange rate shows a stable currency ratio: EUR = 20.0598 MDL, USD = 17.4017 MDL.
Over the course of 2025 and the first few months of 2026, the Moldovan leu depreciated against the euro by a total of approximately 4.7% (or 90 bani). The main phase of devaluation occurred last year, while the exchange rate has stabilized this year.
There were moderate fluctuations throughout the year (from 19.84 lei in February to 20.40 lei in April), but by August, the lei’s net depreciation against the euro was less than 1–2 bani.
To the question of why this happened, we’ll answer: for the same reasons. Changes in the leu’s exchange rate are no longer linked to Moldova’s domestic problems. The leu now largely mirrors the euro’s trajectory on global markets. When the euro strengthened against the dollar on international markets in 2025, it automatically appreciated against the leu as well.
Therefore, the NBM, without false modesty, acknowledges its contributions to European integration through the unification of financial systems.
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