CBCG Council Adopts 2025 Annual Report: Year Marked by EU Alignment, SEPA Accession and Banking Sector Stability
02/06/2026
At today’s meeting, chaired by Governor Irena Radović, the Council of the Central Bank of Montenegro adopted the CBCG Annual Report for 2025, noting significant progress in the implementation of strategic priorities, alignment with European Union standards, and the safeguarding of financial stability.
The CBCG made a key contribution to the provisional closure of Chapter 4 – Free Movement of Capital through the successful completion of Montenegro’s accession to the Single Euro Payments Area (SEPA), as well as by meeting the closing benchmarks in the areas of payment system and financial sector integrity.
At the same time, the CBCG, which coordinates the fulfilment of obligations under Chapter 9 – Financial Services and Chapter 17 – Economic and Monetary Policy, continued to work intensively on aligning legislation with the EU acquis, strengthening institutional and analytical capacities for future participation in the European System of Central Banks and the Eurosystem, and implementing activities related to preparations for the euro convergence process.
A significant contribution was also made under Chapter 18 – Statistics through intensive cooperation between the CBCG, MONSTAT and the Ministry of Finance on establishing a system for compiling Government Finance Statistics (GFS) and Excessive Deficit Procedure (EDP) statistics in line with the ESA 2010 methodology. The CBCG actively participated in the preparation of sectoral financial accounts, the enhancement of balance of payments statistics, international investment position and external debt statistics, as well as in the implementation of IPA projects and activities aimed at meeting the closing benchmarks under Chapters 17 and 18.
These activities represent an important contribution to Montenegro’s strategic objective of concluding EU accession negotiations by the end of 2026 and entering the final phase of the accession process.
As one of the key achievements, the Council highlighted Montenegro’s accession to the Single Euro Payments Area (SEPA). The first SEPA transactions were executed on 7 October 2025, enabling citizens and businesses to benefit from faster, safer and significantly more cost-effective international payments. During the first seven months of using SEPA payment schemes, estimated savings of approximately 4.8 million euros were achieved, demonstrating the tangible benefits of European integration for the Montenegrin citizens and economy.
The Council assessed that the banking sector maintained a high level of stability. Total banking sector assets exceeded €7.9 billion, lending increased by 14.24%, while the share of non-performing loans declined to a historic low of 2.67%. The downward trend in interest rates and improved access to financing also continued.
The Council also noted significant progress in the areas of bank resolution, anti-money laundering and counter-terrorist financing, consumer protection, financial inclusion, digitalisation, and euro counterfeiting protection. Particular attention was devoted to limiting the cost of consumer and housing loans and improving access to financial services for vulnerable groups of the population.
During 2025, the CBCG continued the modernisation of its statistical, information and operational systems, alongside further digitalisation of processes and alignment with EU standards. Significant progress was also achieved in the area of ESG standards and sustainable finance through the implementation of EBA Guidelines on ESG Risks Management in Credit Institutions, with a particular focus on climate-related risks.
The Report further states that activities continued in the areas of human resource development, strengthening transparency, financial literacy and corporate social responsibility, as well as fostering a more inclusive financial system, including support for women’s leadership through the WE Finance Code and Women on Boards initiatives.
The results achieved confirm the CBCG’s strong commitment to contributing to the safeguarding of financial stability and the acceleration of Montenegro’s European integration path through responsible, reform-oriented and proactive action.
At the meeting, the Council also discussed the Financial Stability Report for 2025. It assessed that Montenegro’s financial system remained resilient to both external and domestic shocks, supported by the strong capital and liquidity position of the banking sector and the continued ability to perform financial intermediation. At the same time, further strengthening of cyclical vulnerabilities was noted, primarily due to strong credit growth and continued increases in real estate prices. The Council assessed that the CBCG’s timely macroprudential measures, including higher capital requirements and the extension of measures aimed at ensuring the sustainability of household lending, had further strengthened the resilience of the financial system. It was emphasised that the CBCG would continue to closely monitor the accumulation of systemic risks and, if necessary, take additional measures in a timely manner to preserve financial stability.
The Council also adopted the Price Stability Report for 2025. Average inflation during 2025 stood at 3.9%, with inflationary developments reflecting a combination of external factors, including food and energy prices, and domestic factors, notably strong aggregate demand, wage growth and lending activity. Although disinflationary trends in the international environment helped ease certain price pressures, core inflation remained elevated. The Council noted that projections for 2026 point to heightened uncertainty regarding future inflation developments, particularly in the context of geopolitical tensions and potential disruptions in energy markets.
At today’s meeting, the Council also adopted the Report on the Results of the Bank Lending Survey for the first quarter of 2026 and the Report on the Work of the Advisory Committee for 2025, while also considering other matters within its remit.