Banking Risk and Profitability in Republic of Moldova: Determination of the Optimum Between Risk and Profitability in Banking Sector of Moldova

The banking industry of Moldova is a mixed one comprising nationalized, private and foreign commercial banks. Many efforts have been made to explain the performance of these banks. Understanding the performance of banks requires knowledge about the profitability and the relationships between variables like market size and bank's risk with profitability. Indeed, the performance evaluation of commercial banks is especially important today. Purpose of the analysis is the development of theoretical and practical framework of risk-profitability relationship and research of the optimum level of these variables in banking industry in Republic of Moldova.