Decisions by the Supervisory Council, 6 September 2023

Publication date: 06.09.2023


On 6 September 2023, the Supervisory Council of the Bank of Albania reviewed and decided to:

  • Approve the Financial Stability Statement and Financial Stability Report for 2023 H1

The Financial Stability Report is an important periodic document prepared by the Bank of Albania whose main purpose is to identify and assess risks to the financial system and its infrastructure. The Financial Stability Statement- whose half-yearly release is a legal requirement set out in the Law “On the Bank of Albania”- prefaces the Report.

The Bank of Albania deems that in 2023 H1 (hereinafter ‘the period’), operations of the banking sector were stable. Overall, deposits and loans expanded, but at a lower growth pace than in the previous periods, in refection also of the impact of the significant appreciation of the lek exchange rate. In the context of higher interest rates, credit quality declined slightly, but non-performing loans remain at a historic low.

Overall, the exposure of the banking sector to risks appears contained, but credit and market risks should be carefully assessed on an ongoing basis. Banking sector resilience to risks is assessed as good, given that capitalization indicators remained at suitable levels while financial performance improved significantly. During the period, economic developments were positive, influenced by the good performance of consumption and investments, and especially by the improvements in the current account of the balance of payments. Economic growth was accompanied by a reduction of unemployment and increase in both employment and wages.

Fiscal policy maintained a consolidating trend whilst at the same time fiscal revenues significantly rose. Inflationary pressures decreased, but the inflation rate remained above the Bank of Albania's target, reflecting to a greater extent the contribution of internal economic factors. The Bank of Albania continued with the normalization of the monetary policy, pointing out that its further reaction will reflect developments in the determining factors of inflation.

Risks regarding the economic and financial developments in Albania remain present. These risks relate to the uncertainty about the geopolitical developments and across international markets, the path of inflation, and the impact of market risks. Against this backdrop, it is important that economic policies aim at safeguarding the macroeconomic stability, while financial institutions and supervisory authorities undertake the necessary actions for enhancing the resilience of the financial system.



  • Approve one amendment to the Regulation "On licensing and activity of savings and loan associations and their Unions”

The Supervisory Council was also informed on other daily functional and operational activities of the Bank of Albania.