Fullani accuses foreign banks

During a speech in Vienna, the Governor of Albania’s Central Bank listed the negative consequences of these measures for the Albanian economy.

“The European Union supervisory rules and the risk-related requests for financial groups, together with the approach of their implementation, are imposing significant obligations on oiur economuies and the monetary policy efficiency. We have noted an immediate drop of the financial intermediation, which comes due to the austerity loaning procedures even for economic sectors that had a good progress during the crisis. This stopped investments and reduced the dynamics of our economy in the public and private sectors alike”, Fullani declared.

The Governor used a concerning tone to warn that these consequences might be deeper after the new measures undertaken by the European Union.

“Our researches have shown that a further tightening of the crediting rules through legal reforms, might cause an important effect not only on the economic activity, but also on the quality of assets of commercial banks, especially for bad loans. The deterioration of economic activities would continue in the same way, by bringing a deterioration of bad loans ratio, with lower profits for banks and with bigger limitations of the capital, together with a slower growth”, Fullani declared.

The private sector loan fell with 2.2% in the last year, while in the first three months, the dropping pace went bigger. The European Union is expected to publish in June an evaluation for the Eurozone banking groups, including those in Albania. If the results will require other measures, the concern warned by the International Monetary Fund is that the foreign banks might shrink loans with a higher pace, by deterioration the economic situation even more.

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