IMF Mission Visiting the CBBH

On November 7, 2012, Governor of the Central Bank of  Bosnia and Herzegovina (CBBH)  Kemal Kozarić, Ph.D. with the Vice Governors, received the Mission of the International Monetary Fund (IMF), led by Ron van Rooden. During the discussion on the IMF Stand by arrangement (SBA) first review, the BH macroeconomic situation, fiscal position, monetary issues and the condition of the banking sector were the addressed subjects.

Mr. Rooden informed the Governor Kozarić on so far meetings and discussions and illustrated the position of the IMF Mission on total situation and the perspectives. The indicators for 2012 are lower than previously forecasted, and the 2013 indicators are also expected to be lower than the projections, due to the situation in the Euro zone. As a first step, which is necessary to make, he mentioned the soon adoption of budget by the relevant Parliaments, already by the beginning of December, in order to meet the requirements for further allocation of the SBA tranches.

The Governor Kozarić presented the macroeconomic indicators, and informed Mr. Rooden on the situation in banking sector. The last stress tests findings illustrate that the banking sector is well capitalized, but all the banks have problems with non performing loans (NPL). „Therefore, we are positive about the arrival of  IMF Technical Assistance Mission, who will focus on the assistance to the commercial banks in order to better manage the NPL issues," said  the Governor.

Mr. Rooden pointed out the importance of running the monetary policy through the Currency Board arrangement for the general stability sake, also to keep the CBBH independence, and that everything signed in the Letter of Intent remains in force. The collocutors have also agreed that is it necessary to resolve all the ambiguities related to the servicing of the external debt.

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