Financial Crime World

Acquirer’s Plans Raise Concerns Over Influence on Target Undertaking

Proposed Acquisition Raises Questions

A proposed acquisition has raised concerns over the influence the acquirer intends to exercise on the target undertaking. The National Bank of Moldova (NBM) is set to review the proposal, assessing the financial soundness of the acquirer and its ability to comply with prudential requirements.

NBM’s Assessment Criteria

  • Financial Soundness: The NBM will evaluate the acquirer’s financial health, including:
    • Capital adequacy
    • Liquidity levels
  • Compliance with Prudential Requirements: The assessment will focus on the acquirer’s ability to comply with:
    • Capital requirements
    • Liquidity requirements
    • Large exposures limits
  • Target Undertaking’s Independence: The NBM will examine the target undertaking’s capacity to maintain its independence and operate without undue influence from the acquirer.

The Moldovan banking system has implemented the Basel III framework, introducing new rules aimed at increasing the effectiveness of risk supervision by bank management bodies and regulatory authorities. Under these revised regulations:

  • Capital Buffers: Banks are required to maintain adequate levels of capital buffers.
  • Credit Risk Mitigation Techniques: Banks must employ effective credit risk mitigation techniques.
  • Operational Risk Treatment: Operational risk treatment is now a key focus area.

The NBM will closely monitor compliance with these requirements, ensuring that banks operate in a safe and sound manner.

Conclusion

The proposed acquisition is expected to be completed in the coming months, pending regulatory approval from the NBM. Industry observers are watching the situation closely, awaiting further developments on the potential impact of the acquisition on the target undertaking’s management and operations.