Working Breakfast with the Governor of the Central Bank of Montenegro
16/12/2016
On the eve of the New Year and Christmas holidays, the Governor of the Central Bank of Montenegro, Mr. Radoje Žugić, hosted today a working breakfast with the Montenegrin bankers.
The Governor informed the representatives of banks of the directions of Central Bank’s activities in 2017 that are aimed at achieving basic objectives of the functions under the competence of the CBCG, and that are defined in the current Policy and Guidelines for 2017:
Maintaining the stability of the banking and financial system and price stability;
Soundness and efficiency of payment operations;
Efficiency in in performing the activities of fiscal agent and government banker;
International reserves management;
Supporting the Government of Montenegro in pursuing economic policy.
The Governor underlined that the CBCG’s activities for this year are aimed towards intensifying the cooperation with banks with a view to achieving a countercyclical effect and putting a stronger focus on the recovery of the real economy. Thus, in addition to primary objectives, the activities are directed towards reducing the two key risks as regards the stability of the economic system, i.e. towards strengthening of liquidity (along with the recovery) of the real sector and contributing to the reduction of fiscal pressures, without jeopardizing the independence of the Central Bank. It is expected that these activities will also result in two important contributions to the achievement of the objectives of the CBCG.
Reducing the vulnerabilities of the banking system (by taking an active approach to restructuring of solvent debtors and the recovery of banks’ portfolios)
Reducing the negative public perception regarding the level of profits in the banking sector that are deemed to be to the detriment of Montenegro’s fragile economy.
In addition, it was emphasised that the Central Bank envisages fulfilling its active role together with the banks in the upcoming year. Operational objectives of the Central Bank include the issues regarding interest rates, level of collateral, credit support for micro, small-sized and medium businesses, fostering healthy competition and applying good banking practices, restructuring of debtors with a view to actively engaging all interested parties in resolving the issue of non-service of obligations towards banks and the government, etc.
Without downplaying the main priorities of the Central Bank, the stress is placed on sound and competitive business environment that will generate a sound debtor, which, through their debtor-creditor relation, generates a sound bank, which all together results in financial, i.e. economic stability. Lingering effects of the crisis require such proactive approach to monetary policy, in order to fully contribute to achieving a sound and stable financial and banking system, recovery and stability of the overall economic system, and valorisation of economic potentials necessary for future growth