Financial Stability Report - 2014 H1

The Albanian banking sector and financial system showed stable performance in the first half of 2014. The volume of activity grew and the financial performance improved. The banking sector’s liquidity and capitalisation ratios were at an adequate level during the period. The loan portfolio quality remained a concern, although the non-performing loan ratio appeared more stable and the nonperforming loans, in terms of absolute value, were lower year-over-year. Loan loss provisions and collateralisation of non-performing loans were at adequate levels. The macroeconomic setting is stable, supporting the performance of the financial system. The improved economic growth, and the fiscal and monetary policy actions were accompanied by an adequate functioning of financial markets and lower financing costs.