The Central Bank and UK Company Logica Take a Key Step in Establishing New Payment Systems in Bosnia & Herzegovina

The Central Bank of Bosnia and Herzegovina, (CBBH)* and the UK company Logica today signed a contract for the introduction of a Real Time Gross Settlement (RTGS) system throughout Bosnia and Herzegovina. The introduction of RTGS is a key step in bringing the country's payments system into line with accepted international practice and in allowing the commercial banking sector to take over the provision of payments services as required by the Madrid Declaration. The RTGS system will carry high value and urgent payments and the CBBH will now go on to select a system for carrying low value payments.

The RTGS system will be supplied and supported by Logica who has supplied RTGS systems around the world. Logica will use the services of a local company to assist with the installation and then provide local support to the CBBH after the system goes into live operation.

The system to be installed in BiH is the same system that is already used in nine other central banks including the central banks of Slovenia and Croatia. The timetable for implementation of the RTGS system in BiH is very demanding and the CBBH was only willing to choose a system that was fully developed and proven in live operation. It was particularly important that the system chosen had been successfully operating for three years in both Slovenia and Croatia where the payments and banking background has much in common with BiH. In addition to moving important payments very quickly the RTGS system will build confidence in the banking system by allowing banks to rely totally on the settlement of payments made to them.

Harvey Gritzman, the Manager responsible for developing Logica's payment systems with central banks said, "Logica is delighted to have been selected for this project. An RTGS system is always a nationally important system and this contract is of particular significance in the development of modern, market based financial services in Bosnia".

The new payments system uses Logica's clearing and settlement product and payment instructions will be carried between banks using the S.W.I.F.T. network.

"We chose Logica because we needed a highly skilled and reliable partner with specialist expertise in this area. Logica's experience in implementing RTGS payment systems around the world proved invaluable in providing us with a proven, modern solution", said CBBH Vice Governor Kemal Kozaric, who signed the agreement on behalf of the CBBH.

For further information, please contact the CBBH office of Public Relations at 071/278-123 or via email at [email protected] .