RETRACTION


12/08/2021

Concerning the text published in the daily newspaper “Dan” on 12 August 2021 titled “Žugić Allowed Prva and Zapad Banka to Breach the Law”, we publish the following


RETRACTION


The journalist’s statement that “Žugić allowed Prva Banka and Zapad Banka to breach the law“ is a gross untruth. Obviously, it aims to compromise the integrity of Governor Žugić and the credibility of the Central Bank of Montenegro (CBCG).


The possibility to temporary increase exposure to one person and/or a group of related parties above the prescribed limit was given to all banks in the system. Thus, there is no mention of the alleged privileged position for Prva Banka and Zapad Banka.


It can be easily verifiable by reading the Decision on interim measures to mitigate the negative impact of the communicable disease COVID-19 epidemic on the financial system, adopted by the CBCG Council on 2 April 2020. The Decision defines that “a bank may, with the prior approval of the Central Bank, grant a loan or other exposure to a single person or a group of connected persons, in such a manner that the total exposure toward that person or a group of connected persons exceeds the prescribed exposure limits”. The aim of adopting this temporary measure is to mitigate the adverse effects of the pandemic on loan beneficiaries, primarily entrepreneurs and legal entities, especially concerning difficult access to bank funds necessary to overcome business difficulties.


Apart from Prva Banka and Zapad Banka, other banks in the system used the possibility of exceeding the exposure limit, which the journalist, accidentally or intentionally, “overlooked”.


We note that the application of this measure expired on 30 June 2021, taking into account the normalisation of business in the context of the pandemic.