Skopje, 27 December 2024 (MIA) - The National Bank Council adopted the Report on Risks in the Banking System of the Republic of North Macedonia in the Third Quarter of 2024. The banking sector remains safe and stable, and a decision was made to promote the regulation on identifying systemically important banks (SIBs), the National Bank said in a press release. 

The Council has adopted a new Decision on the methodology for identifying systemically important banks, promoting the current methodology based on which the National Bank identifies systemically important banks in the country and determines the capital buffer for them, reads the press release.

"This is a macroprudential instrument to strengthen the resilience of the banking system by strengthening the solvency and stability of systemically important banks to unexpected shocks or losses that may occur in the course of their operations. The amendments to the decision on systemically important banks are also made for the purpose of further approximation to the Guidelines of the European Banking Authority (EBA) for the identification of domestic systemically important banks," says the National Bank. 

According to the Report on Risks in the Banking System in the third quarter, adds the press release, risk exposure indicators of the banking sector remain stable, and stress tests indicate a good capacity to deal with shocks.

"The capital adequacy ratio remained at 19 percent, the highest in the past seventeen years, while the share of non-performing loans in the total is at a historically low 3 percent. In the third quarter of the year, banks operated in conditions of a significant slowdown in domestic inflation and a favourable foreign exchange market, but the risks from the environment still exist and their continued close monitoring and caution in conducting policies are necessary in order to maintain the stability of the banking sector in the coming period," the press release reads. 

The central bank points out that the growth of deposits from citizens and companies has accelerated and enabled the maintenance of credit growth, as well as an increase in banks' liquid assets. In addition, the annual growth of deposits has accelerated, rising to the level of 7.9 percent, in which long-term savings prevail, as well as denar deposits, also driven by the National Bank's measures to support denarization and long-term savings. An acceleration of annual growth in lending to 7.5 percent is noted, while the results of the Credit Activity Survey for the third quarter of 2024 indicate a further net easing of overall credit conditions and a net increase in credit demand, in both sectors - enterprises and households.

The Council has also adopted amendments to the accounting and financial reporting regulations for banks and savings banks to implement the requirements of the International Financial Reporting Standard (IFRS) - 16 Leases and align with the applicable IFRS, published by the International Accounting Standards Board.

"The National Bank Council also considered several other issues related to the operations and current activities of the central bank, and adopted the Financial Plan and the Investment Plan of the National Bank," reads the press release. 

Photo: National Bank