Banking and Financial Services
Banking and Financial Services
Bosnia and Herzegovina is the first country in South Eastern Europe that has completely reformed its banking system. Foreign banks have invested significantly. HVB Central Profit Bank, Hypo Alpe-Adria-Bank, Nova Ljubljanska banka, ProCredit Bank, Raiffeisen Bank, Turkish Ziraat Bank, Unicredit Zagrebačka banka BiH, Volkssbank, Zepter Commerce Bank are all present in the country. Currently, according to the Central Bank of BiH, foreign banks own 73% of the banking sector, ensuring employment for almost 9,000 people. Bosnia Bank International is the only bank operating in BiH under Islamic banking principle.
One of the leading international credit rating agencies, Moody’s Investor Service, upgraded Bosnia and Herzegovina’s rating from ‘a positive outlook’ to ‘a stable’ outlook in just two years. This more favorable credit rating for Bosnia and Herzegovina was awarded in light of the economic and institutional advances that have taken place since the ratings were first assigned in March 2004.
The introduction of a deposit insurance agency and competition between well-established international banks in BiH has significantly influenced the growth of savings and lowered interest rates on loans. Meanwhile, the country’s stock exchanges are enjoying a period of impressive growth. Still, the challenge for the future is to expand and diversify the range of financial services and intermediation, and other key segments of the market, such as insurance, creating new niches in the market. These developments will undoubtedly create even more business opportunities.
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