The banking sector retains the confidence and preserves stability
06/09/2022
Today’s meeting of the representatives of the Central Bank of Montenegro (CBCG) and commercial banks concluded that the banks’ lending activity in the current year is very intensive, with the preserved system’s stability and the clients’ trust maintained.
In seven months this year, banks approved 826.8 million new loans, or 37% more compared to the same period last year, 74% more compared to 2020 and 27% more compared to pre-crisis 2019. Banks contributed significantly to the domestic economy’s recovery through such intensive lending activity. They provided support to natural persons in securing the necessary financial resources. Despite the increased lending activity, banks maintained an adequate liquid position.
The strong deposit growth in the current year of over 600 million euros confirms the clients’ confidence in the banking sector and the supervisor.
To further strengthen trust and improve the relationship between banks and their clients and the recorded EURIBOR growth, banks will, as soon as possible, prepare protection programmes for clients who have loans with a variable interest rate, which will potentially include the option of switching to loans with fixed interest rate. Through these programmes, loan users will be warned in a clear and unambiguous way about all the risks arising from interest rate fluctuations. Before concluding a loan agreement with a variable interest rate, banks will inform clients of the consequences of a possible further EURIBOR increase, so they will be able to assess whether the proposed loan agreement is adapted to their needs and financial situation.
Today’s meeting also discussed the intensification of cooperation between the supervisor and banks in terms of an adequate response to possible security threats in the field of cybercrime and the status of the project to connect the payment systems of the Western Balkan countries through the ECB payment system (TIPS system).
Concern was expressed about negative macroeconomic trends that, if not stopped in the foreseeable future, could affect the stability of the banking sector.