Kosovo’s Central Bank has a successful track record in ensuring the country’s financial stability. Gani Gërguri, Governor since May 2011 discusses the bank’s policies and priorities.
European Times: What are the Central Bank’s main objectives?
Gani Gërguri: The Central Bank’s mandate is to license, regulate and supervise all Kosovo’s financial institutions. Our major goals are to ensure Kosovo’s financial stability, support price stability, advise the government, and contribute to the efficient allocation of the country’s economic resources.
European Times: What are the Central Bank’s most important accomplishments so far?
Gani Gërguri: Kosovo’s financial sector is strong, healthy and stable and includes a very sound banking sector. For example, Kosovo’s banking sector has continuously maintained a capital adequacy ratio of around 17% as well as double digit increase in both deposits and loans. This growth continued even during the global financial crisis. The share of non-performing loans has never exceeded the single digits. This success is the result of good provisioning and good buffers against threats and shocks. In addition, the introduction of the euro has had a positive effect through helping to bring about monetary and fiscal discipline.
European Times: How have international institutions contributed to the development of Kosovo’s financial sector?
Gani Gërguri: Kosovo has benefited considerably from the big support of international institutions since 1999 and is still working very closely with the World Bank and the International Monetary Fund. Significant support was also given by the US Treasury which, among others, has also helped us develop certain strategies at the national level.
European Times: What is the current state of the banking sector?
Gani Gërguri: Kosovo’s banking sector is very healthy, partly because more than 90% of our banks are foreign-owned. We are also proud of the merger and acquisition process in our banking sector, which has been very smooth. We now have eight commercial banks, of which six are part of foreign banking groups. Three banks cover 75% of the market; these are ProCredit, Raiffesen and NLB.
European Times: How about the insurance sector?
Gani Gërguri: Kosovo’s insurance sector is developing well, with ten non-life insurance companies and three life insurance companies. Most are partners of well-known EU insurance groups. There are still significant opportunities, particularly for life insurance.
European Times: What are the Central Bank’s current goals?
Gani Gërguri: Our main objectives are to maintain the stability of the financial sector and to further promote our banking sector to bring additional players into the market. Also, the CBK is committed to broaden and develop other sectors of the financial markets. The government’s recently introduced securities market is developing very well. The Central Bank of Kosovo will continue to be a strong, independent and effective regulator of the country’s financial sector.
