12/11/2024

The Central Bank of the Republic of Kosovo (CBK) has been praised from the International Monetary Fund (IMF) following the successful completion of the Third Review of the Stand-By Arrangement (SBA), the Resilience and Sustainability Facility (RSF) programs, and the Article IV consultations, during the presence of the IMF Mission in our country from October 28th to November 11th.

The IMF delegation led by Mr. David Amaglobeli – Chief of Mission for Kosovo, has welcomed the progress made by the CBK in advancing the legal and supervisory framework and the reforms undertaken by the CBK aimed at preserving financial stability.

The IMF highlights the CBK's commitment to ambitious institutional reforms, including the improvement of its governance and institutional structure.

The IMF's positive assessment underscores the CBK's proactive approach to strengthening governance, financial stability and sustainability, as well as the reforms undertaken to harmonize with the standards and practices implemented in the European Union.

In addition, the IMF has assessed the CBK's progress in advancing the legal framework through the new Banking Law and the Payment Services Law, which are currently under consideration in the Assembly of the Republic of Kosovo, which, in addition to strengthening and advancing banking supervision, will support Kosovo's integration into the European Union. In this regard, the modernization of the banking supervision process is mentioned, including the Supervisory Review and Evaluation Process (SREP), which aligns the supervisory framework of the CBK with the framework implemented by the European Supervisory Authorities.

Regarding the financial sector, the IMF team notes that the banking sector remains stable and growing, supported by strong and sustainable lending, liquid and adequately capitalized, with a low nonperforming loan ratio. The reforms undertaken by the CBK to capitalize the sector by implementing the countercyclical capital buffers and capital surcharges for systemic banks.

During the meetings with the IMF Mission, it was assessed positively the review of premiums to capitalize the Deposit Insurance Fund, including emergency liquidity reserves supported by the REPO line from the European Central Bank (ECB), which will further enhance the stability and sustainability of the banking sector and the financial sector in general.

The IMF appreciates the progress and steps taken by the CBK to integrate Kosovo into the Single Euro Payments Area (SEPA) through the advancement of the legal framework and the submission of the pre-application to DG FISMA of the European Commission and the European Payments Council (EPC) on October 14th, 2024.

The CBK remains committed to fulfilling all the measures foreseen in the Program with the IMF, as part of the reform activities in line with its objectives and the Strategic Plan.

In conclusion, the CBK express gratitude to the Chief of Mission and the IMF team for the constructive cooperation and support in the form of technical assistance for the advancement of the reform process.

Please read here the full Press Release published by the IMF🔗 https://www.imf.org/en/News/Articles/2024/11/11/pr-24411-kosovo-imf-reaches-sla-on-3rd-rev-of-stand-by-arr-and-rsf-and-concludes-aiv-discussions