Bosnia And Herzegovina Financial System Stability Assessment-Press Release; Staff Report; And Statement By The Executive Director For Bosnia And Herzegovina by International Monetary Fund. Monetary And Capital Markets Department.

Full Title: Bosnia And Herzegovina Financial System Stability Assessment-Press Release; Staff Report; And Statement By The Executive Director For Bosnia And Herzegovina
Author/Editor(s): International Monetary Fund. Monetary and Capital Markets Department
ISBN: 1513546635, 9781513546636
Publisher: International Monetary Fund
Published Place: Washington, D.C.
Published/Copyright Year: 2015
Language: English
Series: IMF Staff Country Reports: Country Report No. 15/177
IMF ELibrary
Number of pages: 1 online resource (76 pages)
Categories:
Bank Resolution
Banks
Capital Markets
Currency Boards
Financial Safety Nets
Financial Sector
Financial System Stability Assessment
Insurance
Liquidity Management
Macroprudential Policy
Press Releases
Reports On The Observance Of Standards And Codes
Bosnia And Herzegovina


Content:
EXECUTIVE SUMMARY Economic and financial activity in Bosnia and Herzegovina (BiH) remains stuck in a low gear since the global financial crisis, reflecting weak external demand, tighter funding conditions, and deep seated structural issues. A high system-wide NPL ratio—14 percent at end-2014, about two thirds of which are provisioned—reflects the impact of the crisis, low growth since then, and a history of lax lending policies. Bank governance problems, related-party loans and inadequate corporate resolution and insolvency frameworks are obstacles to addressing asset quality problems and re-establishing bank profitability. Institutional fragmentation is delaying much-needed financial sector reforms. Aggregate solvency and liquidity indicators appear broadly sound, but significant pockets of vulnerability exist. The banking system is more than 80 percent foreign-owned banks. The average regulatory capital adequacy ratio exceeded 16 percent as of end 2014. However, the dispersion among banks is wide, ranging from about 7 percent to 48 percent. Vulnerabilities are concentrated within domestically-owned banks, some of which are struggling to meet capital requirements, while some others are relying on public support. Stress tests indicate that these banks have large concentration risks and low liquidity ratios. While the insurance sector is small, a number of companies have thin solvency margins. FSAP team access to supervisory data—at the individual bank level, aggregated along group of banks, and system wide level—was exceptionally good. Decisive and timely actions to deal with weak banks are critical for preserving financial stability. A comprehensive strategy—backed by a credible diagnostic assessment—is needed soon to either facilitate the recovery of these banks (if practicable) or to resolve them in a cost-effective manner that is also consistent with maintaining the stability of the financial system and protecting insured depositors. The timetable for these steps should be spelled out clearly and effectively communicated, and consideration should also be given to a credible and transparent public backstop to deal with potentially systemic cases. Banking and insurance oversight improved since the 2006 FSAP, but a number of important shortcomings remain that have contributed to the vulnerabilities of the financial sector. Cooperation among the various oversight institutions is complex, having potential repercussions in times of stress. Lack of adequate governance and risk management has contributed to the current number of problem banks. The administrative powers of the agencies to sanction and fine supervisory board members and significant owners are inadequate. Moreover, the identification of ultimate beneficial owners of banks is problematic and related-party lending and group exposures are obscure. There is a need to further strengthen the supervisory board selection process and internal audit functions of state banks. The prudential framework for the insurance sector should be updated to improve its risk sensitivity. Consumer protection and financial literacy in the insurance industry are weak and should be improved. The legal framework governing creditor/debtor relationships is comprehensive; however, neither debt resolution nor bankruptcy liquidation work effectively, impeding NPL resolution.

Electronic Resources:
http://hdl.library.upenn.edu/1017.12/1522425

ISBNPlus ID: UPE.BD102.22155-11-2209195
Form: Nonfiction
Released Date: 20151203

Download BiBTeX of this book (.bib)
@book{isbnplus9781513546636,
 title={Bosnia And Herzegovina Financial System Stability Assessment-Press Release; Staff Report; And Statement By The Executive Director For Bosnia And Herzegovina},
 author={International Monetary Fund. Monetary and Capital Markets Department},
 isbn={9781513546636},
 series={IMF Staff Country Reports: Country Report No. 15/177},
 url={http://isbnplus.org/9781513546636},
 year={2015},
 publisher={International Monetary Fund},
 address={Washington, D.C.}
}
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%0 Book
%T Bosnia And Herzegovina Financial System Stability Assessment-Press Release; Staff Report; And Statement By The Executive Director For Bosnia And Herzegovina
%A International Monetary Fund. Monetary and Capital Markets Department
%@ 9781513546636
%U http://isbnplus.org/9781513546636
%D 2015
%I International Monetary Fund
%C Washington, D.C.
Download 9781513546636.enw
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TY  - BOOK
T1  - Bosnia And Herzegovina Financial System Stability Assessment-Press Release; Staff Report; And Statement By The Executive Director For Bosnia And Herzegovina
A1  - International Monetary Fund. Monetary and Capital Markets Department
SN  - 9781513546636
T3  - IMF Staff Country Reports: Country Report No. 15/177
UR  - http://isbnplus.org/9781513546636
Y1  - 2015
PB  - International Monetary Fund
CY  - Washington, D.C.
ER  - 
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APA Style:
International Monetary Fund. Monetary and Capital Markets Department (2015). Bosnia And Herzegovina Financial System Stability Assessment-Press Release; Staff Report; And Statement By The Executive Director For Bosnia And Herzegovina. Washington, D.C.: International Monetary Fund.

MLA Style:
International Monetary Fund. Monetary and Capital Markets Department. Bosnia And Herzegovina Financial System Stability Assessment-Press Release; Staff Report; And Statement By The Executive Director For Bosnia And Herzegovina. Washington, D.C.: International Monetary Fund, 2015. Print.

Chicago Style:
International Monetary Fund. Monetary and Capital Markets Department. Bosnia And Herzegovina Financial System Stability Assessment-Press Release; Staff Report; And Statement By The Executive Director For Bosnia And Herzegovina. Washington, D.C.: International Monetary Fund, 2015.