TIRANA, April 29 – The rapid growth of investment funds favoured by higher interest rates compared to the traditional bank deposits has forced the Albanian Financial Supervisory Authority to undertake legal initiatives targeting increased transparency toward investors and the fund’s risk administration.
Introducing an annual report at the parliamentary economy and financial committee this week, the Authority’s director Enkeleda Shehi said “the strengthening of the transparency regime and consumers’ education is very important considering the novelties financial investments activities produce on the market, with risks not always easily understandable by consumers.”
“Risks have increased due to the recent efforts by some unlicensed operators to offer financial products or services,” said Shehi.
Investments funds represented the second biggest financial market at the end of 2014 with assets estimated at 4.6 percent of the GDP.
Data published by the Albanian Financial Supervisory Authority which supervises this market operational only for the past three years, shows the only two operators controlled by Raiffeisen Bank, the country’s biggest commercial bank, increased their net asset value by 27 percent to 63.7 billion lek (Euro 446 million) at the end of 2014 compared to 2013.
Some 32,669 people are reported to have invested in these funds by the end of the final quarter of 2014, up 15 percent compared to the end of 2013.
“While these funds have helped diversify the ownership of government securities, they are inadequately supervised and regulated, invest mostly in longer-dated securities and their clients appear to consider these funds as substitutes for bank accounts,” warns the IMF in its latest report.
Currently only two investment funds, Raiffeisen Prestigj and Raiffeisen Invest Euro operate in Albania. The funds were established in early 2012 by Raiffeisen Bank Albania, the leading commercial bank operating in Albania. The timing coincided with the decision of Raiffeisen decision to scale back its participation in the public debt market to limit its exposure to the Albanian sovereign debt.
