Accumulation of money gets invested abroad

TIRANA, March.12 -the increasing deposits in the Albanian banking system are not helping the domestic investment field. Banks prefer to invest the money abroad. Data from BoA reveal that 2006 has been a record year for foreign currency deposits and thus banks have chosen to invest it in financial options outside of Albania. The Albanian economy though needs this money for investments. Dollar is the favorite currency used in 55 percent of all foreign investments, followed by euro in the amount of 39 percent and English pound with 6 percent. Resident and non resident deposits that were used to finance foreign investment increased this year by 157 million leks. The portfolio composition has changed as well with a shift from investments to foreign held deposits, which can be explained by the banks need for security and diversification. Investment portfolios mount to 84.3 million euro, with 77 percent of them being dollar denominated, 16 percent in euro and 7 percent in pounds.