Nicholl: Statement of minister Džombic is politically motivated 6/6/2006 Tweet Statement of the Finance Minister of Republika Srpska (RS) Aleksandar Džombić on banking supervision is politically motivated and he clearly does not understand what has been proposed for the last three years said Peter Nicholl, Advisor of the US Treasury for the banking supervision and former Governor of the Central Bank of Bosnia and Herzegovina (CBBH). Minister Džombić said on Monday, June 5, 2006, that bringing banking supervision under the CBBH would be a “mistake” because the CBBH has “no infrastructure and resources for that job”. The infrastructure and resources of the Banking Agencies would be incorporated within the CBBH so that the same resources would continue to carry out day-to-day supervision activities. This would be the case no matter what option for unified supervision is adopted in BH - the existing resources would be used. What the CBBH would provide for a unified supervision function is a good senior management structure, proven operational and financial independence, the assurance of a single supervision policy for all banks in BH and the ability to establish good working relationships with all other banking supervisors in the region. “The banking supervision function is within the central bank in every other country in the south-eastern European region except BH” said Mr. Nicholl. Mr. Džombić has agreed that the function of banking supervision in BH needs to be carried out on a unified basis because BH has a single banking system. Every other major function related to the BH banking system - reserve requirements, the payments system, deposit insurance - is carried out in a unified manner already and has been for some years. The BH Federation Government has agreed to the transfer of competency for banking supervision to the state level and will submit this proposal to BH Federation Parliament. The RS Government need to do the same if any progress is to be made on this issue, which has been under discussion for five years already, said Mr. Nicholl. Once that step is taken it will be appropriate to discuss whether the banking supervision function in BH would be implemented best within the CBBH or in a separate organization concluded Mr. Nicholl Public Relations Section Coordinator Zijada Kovač
