• Governor cites political pressure after president's criticism
  • Anti-government protesters are demanding early elections

Moldova’s central bank governor resigned, citing political pressure, as public anger boiled over after $1 billion went missing from three retail lenders and left the country on the verge of bankruptcy.

“I and the rest of the central bank’s board are offended by the rising political pressure toward the central bank,” Dorin Dragutanu said Monday by phone. “It’s not acceptable for a prime minister or a president to tell the central bank what to do in managing the currency or supervising the banking system via public messages.”

Dragutanu, who pledged to stay on in an interim capacity, said his deputy also stepped down.

The banking fraud, equivalent to about an eighth of economic output in the country of 3.4 million, sparked street protests, demands for the resignation of President Nicolae Timofti and early elections. The strain on the finances of Europe’s poorest country has prompted it to seek talks with the International Monetary Fund over a bailout, Prime Minister Valeriu Strelet said this month.

State aid to the banks and threat of default has weakened the currency, the leu, sending it more than 20 percent lower against the dollar this year and helping stoke inflation to its highest level in more than three years. Timofti had sought Dragutanu’s resignation over his handling of the rescue of the three troubled banks, which the government now plans to liquidate.

Moody’s Investors Service lowered the outlook on Moldova’s B3 junk rating to negative from stable in July, citing growing pressure on the country’s finances from the cost of the bank bailout. Moldova placed 103 of 175 countries in Transparency International’s Corruption Perception Index last year, on par with Bolivia and Mexico.

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