Albanian economy demonstrates remarkable resilience, central bank chief says

15 Maj 2024, 12:06Economy TEMA

Albanian economy demonstrates remarkable resilience, central bank chief says

May 15, 2024 — In his address on the 25th Anniversary of the Albanian Association of Banks, the head of the central bank Sejko highlighted the banking sector's vital role in Albania's economic development over the past 25 years.

He emphasized the sector's resilience amid challenges such as the global financial crisis, the Greek debt crisis, the COVID-19 pandemic, and fallout from the conflict in Ukraine. Despite these obstacles, Sejko noted a substantial increase in credit to the economy, rising from 7% of GDP in 2002 to 30% in 2023.

Sejko praised collaborative efforts between the Bank of Albania and the Albanian Association of Banks in implementing key reforms. Notably, measures to reduce non-performing loans led to a significant decrease, from nearly 25% of the credit portfolio in 2014 to 4.64% currently. This reduction facilitated stable growth in bank credit, with private sector credit rising by 40% over five years and experiencing a recent surge of close to 12% in the first quarter of 2024.

Regarding financial inclusion, Sejko highlighted marked progress, including increased access to bank accounts, internet banking, and electronic payment instruments. These advancements, evidenced by rising bank card ownership and e-commerce infrastructure, signal Albania's shift towards a cashless economy.

Looking ahead, Sejko outlined the Bank of Albania's commitment to policies aimed at preserving monetary and financial stability, boosting lending to businesses and households, expanding financial inclusion, aligning regulatory frameworks with EU standards, fostering digital transformation in the banking sector, and promoting stable banking practices.

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