Financial system of Montenegro


The financial system of Montenegro consists of financial institutions, financial market, and financial infrastructure.


The financial system in Montenegro is bank centric given that banks account for the main share in the market (over 90% of the total assets in the financial system) and most of financial intermediation takes place through them. Viewed through the structure of banks' balance sheets, the main activities of banks in Montenegro are: accepting deposits and disbursing loans, as well as providing various types of payment services, while investment banking or active investments in financial instruments are negligible.


The second important actors in the financial system are insurance companies, primarily those offering mainly non-life insurance.


In addition, the rest of the financial sector consists of microcredit financial institutions (MFIs), leasing companies, investment funds (open and close) and factoring companies.


Overview of institutions in the Montenegrin financial sector as at 31 December 2019
Type of institution
No. of institutions

Assets (000 euro)

Share in the
sector assets, %

Banks

13

4,603,920

92.3

Insurance companies

9

235,858

4.7

MFIs

7

71,555

1.4

Leasing companies

2

40,326

0.8

Investment funds

7

35,261

0.7

Factoring companies

1

1,245

0.0

Total

39

4,988,165

100.0

Source: CBCG, Insurance Supervision Agency, CMA


When in comes to the capital market, one stock exchange market (Montenegroberza) operates in Montenegro, where bonds and shares, that is, debt and equity instruments are traded through authorised brokers.  


The CBCG payment system is the most important and also the only payment infrastructure for interbank payments in Montenegro, which consists of two subsystems/modules operating on the same operating platform - RTGS and DNS systems. On the other hand, Central Securities Depository and Clearing Company (CSD&CC) which is also the depository of securities, owner and operator of the securities settlement system.


The regulatory framework of the financial market in Montenegro is segmented and divided among three regulators. The Central Bank of Montenegro supervises banks, MFIs, and institutions dealing with leasing, factoring, purchase of receivables, and credit-guarantee operations. The Insurance Supervision Agency  carries out the supervision of insurance companies, while the Capital Market Authority supervises investment and pension funds. Additionally, the CMA supervises the capital market itself, that is, the work of the stock exchange and authorized dealers on the market. The Capital Market Authority also oversees the securities settlement system through supervision of the CSD&CC. Finally, the oversight of payment systems is organized within the CBCG through a separate organizational unit.