Doverie – 2025 Q2 review – Booming bank performance in Q2

Booming bank performance in Q2

Q2 2025 Results

• Total revenues in Q2 increased by 10.7% year-on-year, reaching BGN 320 million. The main driver was the 23% growth in banking revenue, which reached BGN BGN 195.6mln. Insurance revenues ceased since the insurance company within the holding was sold to Generali with the deal finalized on 11 Feb 2025. Revenues from other business sectors increased by 8.2% to BGN 124.1mln.
• Moldindconbank, Doverie’s largest holding, will continue to be a key asset in the group’s portfolio. Although the current period may seem challenging for the business, it represents an investment in future growth and Doverie will benefit, especially after the removal of the profit retention requirement aimed at maintaining the stability of the country’s banking system.
• The 43.5% growth in net interest income for the 6 months reaching BGN 98.7mln is exceptional considering that the YoY growth for Q1 was 32.4% and that alone was very impressive. This performance is the result of a 31.9% increase in interest income and flat interest expenses compared to the Q2 2024. The growth in lending was obvious as interest from loans increased over 47.3% YoY to BGN 95mln. In the same time, interest on deposits stayed flat BGN 23.5mln.
• Moldindconbank announced a 17% growth in its loan portfolio for Q2 2025. By the end of Q2 2025, corporate loans increased by 14% YoY and personal loans increased by 19.2% compared to same quarter last year.
• Such significant growth is achievable by improving lending conditions, such as more competitive interest rates (which may lead to a decrease in the net interest margin) and higher loan-to-value ratios (e.g. lower down payments required for mortgages). The impact of these changes will lead to an increase in interest income, which is expected to be reflected further in 2025. The clear business focus on retail lending, specifically mortgage lending, leads to greater net interest income as these business lines are more profitable than corporate lending.
• Mortgage lending has the potential to drive the growth in the next year as the real estate in Moldova is in a unique position. On the demand side there are 3 factors which are beneficial: increased investments by the Moldovan diaspora, influx of Ukrainian refugees and government backed programmes, such as “Prima Casa”, which facilitate homeownership of young families and first time buyers. On the supply side both construction materials rising with more than 50% over the last 3 years and labor shortages created a situation, where the newly built homes were much fewer – in the period 2022-2024, the volume of commissioned housing was more than 50% lower than in 2019-2021 (0.8mln sqm versus 1.7mln sqm). Considering the trend that more people are moving in the capital Chisinau to look for opportunities (a clear trend observed in every Eastern European nation), the highest rental yield among European nations 8.38% and some of the lowest tax rates (12% income tax on rent, 12% corporate tax) and some of the lowest buying (2.8%) and selling (4%) costs, the real estate market is prone to be increasing in the near future.
• Moldindcombank is clearly in the position to benefit from the growing demand for mortgage loans. With the growing market, however, other banks will step up to take the opportunities and since it is a matter of a policy decision for the competing banks to offer similar or better conditions, we might see curbed growth in the next quarter.
• The “Other income” category includes profits from five sectors: construction, wine production, DIY products under the Mr. Bricolage brand, medical services and detergent production. Mr. Bricolage sales dominate this category, contributing to 80.7% of the total. Those revenues plus the revenues from medical services were the drivers for the growth in this category. The DIY products were responsible for 3/4 of the growth and Medical for 1/4.
• Sales of the non-banking business increased by 8.2% in Q1 2025, reaching BGN 124 million. Among the other sectors, construction recorded a decline of 3%, and winemaking was flat, whereas detergents lost 2/3 of its revenue, but due to its small share they did not have a great impact.
• The non-banking business, with the sale of the insurance company, now represents 39% of the portfolio revenue, or BGN 124mln.
• Operating expenses decreased by 4.2%, while administrative expenses decreased marginally by 4%. As a result, EBIT shot up by 120% to BGN 97.3 million, and EBITDA followed suit by increasing by 92% to BGN 110 million. The net margin attributable to shareholders also increased by 8.6%, reaching 14.3%.

Full report can be downloaded here: