TIRANA, Sept. 1 – The Konfidustria business association has expressed its concern over the functioning of Albania’s banking system considering that lending remains at historic low levels while banks continue posting higher profits.
Konfindustria’s administrator Gjergj Buxhuku says the Albanian banking system continues operating under oligopoly conditions with loan interest rates six times higher than deposit rates, failing to contribute to the country’s sustainable growth.
“The government and the Bank of Albania as the institution responsible for supervising the banking system should make a quick intervention to prevent the monopoly situation in the country’s financial market for the proper use of Albanians’ savings, which are relatively high compared to regional countries,” says Buxhuku.
Albania has 16 commercial banks, the overwhelming majority of which are foreign-owned, but the top five banks represent about 90 percent of total banking sector assets, says the IMF.
Banks posted surprise profits in the first half of this year as non-performing loans dropped by 4 percent to 20 percent but lending strived to remain at positive growth rates.
Latest data published by the country’s central bank shows banks’ profits rose to 8.3 billion lek (Euro 58.6 million) in the first half of 2015 up from 5.4 billion lek (Euro 38.3 million) during the same period last year.
