CBK approves the Advisory Letter on Syndicated Loans

The Central Bank of the Republic of Kosovo (CBK) has approved the Advisory Letter on Syndicated Loans, which enables the expansion of financial support by the banking sector to local borrowers for large, strategic, and long-term projects, including clean energy projects and other investments that are capital-intensive.

The regulatory framework facilitates the necessary arrangements and creates additional opportunities for crediting to the economy, by diversifying credit risk, contributing to financial stability, and stimulating investments in specific sectors of the country.

The Advisory Letter, which outlines supervisory expectations, aims to establish a regulatory framework, expands the lending capacities of the financial sector to support economic development by reducing concentration risk, promoting broader participation in investments, potentially encouraging shifts away from traditional sectors, and enhancing the efficiency of financing large projects while ensuring full compliance with competition principles.

In addition to market development, banks are required to develop internal policies and procedures related to syndicated loans, considering the Competition Law to ensure fair competition in alignment with international best practices.

The guidelines have been developed based on the most advanced international practices and legislation, in line with the objectives set out in CBK’s Strategic Plan, with support from USAID through the “Kosovo Investment Promotion and Access to Finance Activity”. This process also included extensive consultations with the financial sector carried out by CBK and USAID experts, including several workshops aimed at capacity building.

CBK expresses its gratitude to the United States of America, which, through USAID, supported the drafting of the Advisory Letter as well as its ongoing support for CBK and the financial sector to enhance access to finance and develop the financial market.