Two more banks in Montenegro

Two more banks and a micro-credit institutions will operate in Montenegro as from January, while the Ziraat Bank should get licensed in June.

According to unofficial information of Pobjeda, Central Bank (CBM) has completed testing of the two banks. The founder of one of them is the Ukrainian capital, while the other consortium is formed from Switzerland and the United Kingdom.

Checks have been also completed for micro-credit institution, backed by domestic capital.

According to the law, checks of bank’s founders , audit findings regarding the persons associated with the founder takes maximum of six months. After that, there is a period of two months for registration in the Commercial Court and the same deadline for the start of work.

12 banks currently operate in Montenegro , the latest of them, the Lovcen Bank started operations in September. After Lovcen from micro-credit institution became a bank , five more of them remained in the system .

According to the Council of the CBM, in the third quarter micro-credit institutions recorded a growth of primary balance sheet items, ie assets, deposits and capital. Liquid assets grow and improvement in all indicators of all indicators of asset quality as compared to the previous quarter. The financial result at the system level is positive.

After CBM in July recommended the banks to reduce interest rates, they are in decline and are lower by one percentage point. According to the Central Bank records, there was an increase in banks’ lending activities, and in the last quarter of newly approved loans rose to 196 million eura.

Entry of two new banks and one micro-credit institution into Montenegrin market should contribute to a further decline in interest rates, due to increased competition. Especially as the new banks will not be burdened with bad loans, which hinder business active banks and amount to 18.34 percent of total assets, or 447 million euros.

Izvor: RTV Montenegro