Munteanu’s Push to Revive the Economy: Are Moldova’s Banks Ready?

Anton ŠVEC

The candidate for prime minister has unveiled a completely renewed economic team in the government. Reviving the economy may require the normalization of the banking sector’s operations

The main expectation of both the authorities and the population from Alexandru Munteanu (whose appointment by the PAS-dominated parliament is beyond doubt) is the normalization of the public finance sector and the achievement of adequate economic growth. In recent years, the country has faced stagnation: direct investments have declined, entire sectors of the national economy have deteriorated, and external debt has been rising rapidly. Amid the inflationary trends, significant tariff increases, impoverishment, and population migration – all resulting in economic stagnation (this year, GDP is unlikely to show growth even at the level of 1% after a meager 0.1% in the previous period) – the country’s largest banks have reached peak profitability. According to official data, in January-September 2025 they recorded a net profit of 3.4 billion lei. Of this amount, over one billion each came from MAIB and Moldindconbank, which are closely – including through personal ties – associated with the previous government. A successful and profitable stage in Alexandru Munteanu’s career in the mid-1990s was also linked to his work in the banking sector and the patronage he received through family connections, which proved instrumental for him – a physicist by education. One way or another, the future prime minister has a reputation as a specialist in economics, investment, and finance, making his attention to the banking sector inevitable. All the more so as interest in this topic is inevitably fueled by the ongoing court hearings in the case of Vladimir Plahotniuc. One of the main accusations brought by the state prosecution against the former coordinator of the ruling coalition concerns his involvement in the so-called “theft of the century”, the withdrawal of more than 1 billion euros (in equivalent) from three commercial banks in the autumn of 2014, followed by an attempt to liquidate them. At that time, the government and the National Bank – both believed to have been controlled by Plahotniuc – decided to allocate funds to cover the assets siphoned off through offshore schemes, effectively transferring the losses to the state debt, which under this item has now reached 25 billion lei. Although Ilan Shor, who controlled at least the largest bank, Banca de Economii, and Veaceslav Platon, who owned the financial institutions that lent money to the government, are named as the main beneficiaries of the fraud, prosecutors claim that Vladimir Plahotniuc received at least 42.5 million euros through companies affiliated with Ilan Shor. The defendant, extradited from Greece, has not yet appeared in court, as he is studying the multivolume case materials and preparing to make corresponding revelations. The outcome of this process may affect not only the reputation – and potentially the personal freedom – of the former head of the National Bank, Dorin Dragutanu (widely regarded as the author of the fraudulent scheme later turned by Shor into the “theft of the century”), or of former Prime Minister Iurie Leanca and his superior Vladimir Filat, but also of certain current officials. A crucial factor for Alexandru Munteanu is the lack of time for a slow start – PAS has retained power and must urgently begin correcting the mistakes made over the past four years. There are no grounds to expect a sharp increase in private foreign investment or an inflow of grant and credit resources. On the contrary, U.S. funding is steadily declining, while Brussels, having achieved its interim objectives in Moldova, will inevitably shift its focus to internal challenges. Moreover, Moldova’s key donors are themselves facing serious economic difficulties. In Germany, mass layoffs, cuts in social benefits, and fears of a recession persist; in France, the pension reform that was supposed to help reduce the budget deficit has been suspended for domestic political reasons; and in Romania, the ideologically fragile ruling coalition may collapse amid painful austerity measures. Rapid economic measures will require substantial domestic investment and a high level of monetary liquidity. In this sense, involving commercial banks in efforts to accelerate Moldova’s economic growth appears to be the most straightforward option. This approach aligns well with Alexandru Munteanu’s background and professional profile. For several years, Moldova operated under a system in which financial assets were siphoned off from industry and social infrastructure into the profits of commercial banks. As a result, the banks, their shareholders, and ultimate beneficiaries – including some within the government – grew wealthier, while the socio-economic situation continued to deteriorate. Of course, Munteanu will never be allowed to fully reverse these processes, but certain shifts in the banking sector can nonetheless be expected. One need not look far for an example: the administration on the left bank of the Dniester withdrew 100 million rubles (over 6 million dollars) from the profits of the local central bank to cover the budget deficit. The matter was settled by a law signed by Vadim Krasnoselsky. Without government backing, Moldova’s banking system may face, if not a full-scale bailout, at least some “leaning out.” Alexandru Munteanu has already begun preparing the ground for this by appointing new figures to key positions in the economic bloc – the ministers of economic development and digitalization, as well as finance, will be replaced. Personnel changes are also expected in state agencies and commissions. Obviously, the funds that were siphoned off 10 years ago (the majority of them) cannot be recovered. However, the current profits of commercial banks are sufficient to stimulate economic activity through targeted, well-managed injections. The prime minister will likely face resistance from the head of the National Bank, Anca Dragu, as well as from Dumitru Alaiba, who bears personal responsibility for the degradation of the country’s economic environment. However, the fulfillment of his mandate and the expectations of citizens will directly depend on his ability to make bold decisions and his readiness to convince the ruling party – and, ultimately, Maia Sandu – of the effectiveness of the proposed measures.