Meeting of the Financial Stability Council
22/07/2024
Today, the Financial Stability Council (FSF) held its 69th meeting chaired by Ms Irena Radović, the CBCG Governor and the Council Chairman, and attended by the Council members Mr Novica Vuković, the Minister of Finance, Mr Željko Drinčić, the President of the Capital Market Authority, and Mr Marko Ivanović, the President of the Insurance Supervisory Agency’s Council. The Director General of the Deposit Protection Fund, Mr Vojin Vlahović, also attended the meeting at the Governor’s invitation.
The Council members discussed potential impacts of climate change on the financial system and it was pointed out that the risks associated with climate change affect macroeconomic indicators, including inflation, economic growth, and financial stability. The conclusion reached is that this implies and emphasizes the need for a proactive approach, including the development of a the financial sector`s Roadmap for sustainable finance. In this regard, the Council members agreed today on the setting up of an intersectoral working group to be tasked with a drafting of the aforementioned document, which will include representatives of the CBCG and other regulators on the financial market, the Ministry of Finance, the Ministry of Economic Development and other recognized stakeholders who will give their valuable contribution to these efforts. The roadmap will aim to increase financial flows to sustainable projects and support a faster and more efficient transition to a greener and more sustainable and resilient economy.
The Council members also praised the coordination of the Central Bank of Montenegro, the other regulators, the Government, and the Parliament that resulted in the official submission of the application for Montenegro's accession to the Single Euro Payments Area (SEPA) on 1 July 2024. The meeting participant expressed their expectation that the application will be positively evaluated by the European Payments Council during the coming months, accentuating also the importance of continued activities on the banking system preparation for connecting to the SEPA network.
The Council members discussed the obligations arising from the negotiation chapters 4 (Free movement of capital) and 9 (Financial services) that refer to the need for further alignment of regulations with the EU acquis. In accordance with the commitment of the key actors in this area, the Council supported the intensification of activities aimed at meeting the necessary requirements.
Another issue discussed today is a potential issuance of government bonds on the domestic market and this initiative was assessed as positive, especially in the context of the domestic capital market development and encouraging private savings.
When discussing the current economic trends, the Council members agreed on the conclusion that financial stability in the country was preserved in the first half of 2024 and that the present risks are moderate.