Risk Management Rules for Non-Bank Financial Institutions in Albania Take Effect

New Regulations Aim to Enhance Risk Management Practices

TIRANA, ALBANIA - The Supervisory Council has approved new rules aimed at regulating risk management practices among non-bank financial institutions operating in Albania. As of March 12, 2020, these regulations will apply to micro-credit financial institutions, electronic money institutions, and other non-bank financial entities licensed to conduct financial activities within the country.

Purpose of the Regulations

The primary objective of these rules is to establish a framework for managing risk in the operations of non-bank financial institutions. The Supervisory Council aims to ensure that these entities operate with transparency and prudence, minimizing potential risks to their customers and the broader financial system.

Key Requirements

As part of the new regulations, non-bank financial institutions will be required to:

• Implement robust risk management practices
• Maintain a high level of capital reserves

These requirements are expected to enhance the stability of the Albanian financial sector and provide greater confidence among investors and consumers.

Enforcement and Compliance

The Supervisory Council has emphasized that the regulations will be strictly enforced, with regular monitoring and inspections carried out to ensure compliance. Non-bank financial institutions found to be non-compliant risk facing penalties and other regulatory actions.

Industry Reaction

Industry experts have welcomed the new rules as a positive step towards strengthening the Albanian financial sector. “These regulations are long overdue,” said one analyst. “They will help to promote a culture of risk management among non-bank financial institutions, which is essential for maintaining stability in our financial system.”