Serbia’s banking system is highly liquid and stable, and there are no reasons for worry, National Bank of Serbia (NBS) Governor Jorgovanka Tabakovic has said.
Certain banks were, however, shut down last year due to the country’s poor regulations for setting up companies, Tabakovic said for Radio and Television of Serbia (RTS) on Monday evening.
Companies can be established by persons who have already committed frauds and damaged banks, Tabakovic noted.
“If you allow financial crimes to pay and perpetrators to go unpunished, establish new companies and be welcome borrowers in new banks, that this is a problem,” the Governor said.
Such harmful practice was stopped early in 2014 when Univerzal Banka was closed down, and the case is expected to come to trial, she said.
In the case of Srpska Banka, the government, as the owner, has initiated restructuring, and this will in no way jeopardize the stability of the financial system, she said. All problems are being openly discussed in the ongoing talks with the IMF Mission, Tabakovic said.
“They respect the decisions made by the government and the central bank together with the Deposit Insurance Agency with a view to preserving the stability of the financial system,” Tabakovic said, adding that she thinks that there will be no obstacles to reaching an agreement on the precautionary arrangement.
“I believe that a precautionary arrangement, which will be most helpful and least expensive, will be reached soon,” she said.
Commenting in the weakening of the dinar against the euro, Tabakovic said that since the beginning of the year the dinar went down by 4.5 percent, which far less than the value that the euro lost against the dollar.
“We are all exposed to turbulences in the domestic economy and the international surrounding,” the governor said, adding that the central bank can have an active role in the process by taking measures to alleviate the weakening of the dinar.
Serbia has reached the lowest inflation in history, the governor said, stressing that this ensures stable business conditions and represents the best call for investors to come to Serbia.
Source; in Serbia
