Concerning the announcement of Elektroprivreda Crne Gore (EPCG) on the refusal of the Central Bank of Montenegro (CBCG) to issue an approval for electing Janko Milatović as a member of the Board of Directors of Prva Banka, to fully and accurately inform the public, we give the following


Given that the Board of Directors manages the bank and supervises its operations and that the competencies of its members have a direct impact on the bank’s financial stability, the CBCG pays special attention to deciding on applications for approval of this body’s members. The CBCG thus contributes to preserving the health of the banking system and the financial system’s stability, which is its sole responsibility. The CBCG acts as a professional and independent institution and is absolutely immune to political pressures in achieving this goal.

Regarding the EPCG’s release, we point out that the CBCG conducted the procedure of deciding on the request for issuing an approval for electing two members of the Board of Directors of Prva banka Crne Gore AD Podgorica - Founded in 1901 following the provisions of the Banking Law (“Official Gazette of Montenegro (OGM)” Nos. 17/08, 44/10, 40/11, 73/17). Upon completing this procedure on 11 August 2021, it issued a decision approving selecting one candidate and refusing to give consent for selecting another proposed candidate.

During conducting the mentioned procedure, the CBCG had intensive communication with the bank as the applicant. The communication mainly including examining all facts related to the candidate’s CV to properly explore the fulfilment of legal conditions for selecting the proposed person.

The initially and subsequently submitted documentation for the candidate Janko Milatović showed that this person performed the duties of the Head of Planning and Analytics in “HTP Onogošt” AD Nikšić (Hotel Tourist Company “Onogošt”). Under regulations governing banking operations, this function cannot be treated as a managerial one.

Moreover, the candidate was appointed a head-manager and planner-analyst of Hotel Onogošt in “HTP Onogošt” in bankruptcy from 2012 to 2016. This function cannot be treated as a management one because, according to the submitted documentation, this position included “contracting business with clients - weddings, prom nights, welcoming and accommodating sports teams and organising other events such as Honey Days, Dogberry Days, Jeep Rally, etc.“

Given the aforesaid, this procedure determined that the candidate did not meet one of the legally prescribed conditions to be elected a member of the bank’s Board of Directors. More precisely, it did not meet the condition “professional qualification, professional ability and experience to manage a bank”, prescribed by Article 30 paragraph 10 of the Banking Law (OGM 17/08, 44/10, 40/11, 73/17).

The CBCG analysed the legally prescribed condition based on the criteria referred to in Article 4, paragraph 1, item 1, sub-item c of the Decision on more detail requirements to be met by the member of the bank’s board of directors (OGM 80/10). It determined that the candidate did not have experience of at least five years in managerial positions in companies that are not from the financial sector or other legal entities as a base to conclude that he acquired knowledge reasonably assumed to be knowledge responding to requests for establishing and maintaining risk management systems the bank is exposed to in its operations.

Given the aforesaid, it is clear that the CBCG does not “obstruct the holding of the General Meeting of Shareholders and the election of Board of Directors members who would supervise the Bank’s operations”, but it acts under its powers. It approves only the candidate that has met all the requirements to be elected in the bank’s management structure under the law and implementing legislation.

The CBCG is ready to consider the fulfilment of the legally defined conditions for any other candidate for a member of the Board of Directors, for which the bank submits an application.

We are also obliged to inform the public that the Supervision Department performs the decision-making proceeding on applications for approval of Board of Directors members. The materials on each proceeding conducted within this organisational unit are submitted to the Banking Supervision Committee - the professional-advisory board of the CBCG Governor within the Central Bank, for consideration. As the authorised person, the Governor signs the decisions resulting from the said proceedings.