Banks in Bosnia and Herzegovina Emphasize Compliance Training

Sarajevo, Bosnia and Herzegovina - Banks Prioritize Ethics Amid Regulatory Changes

As the banking sector in Bosnia and Herzegovina continues to evolve, institutions are placing increased emphasis on compliance training to ensure they meet regulatory requirements and maintain high standards of ethics. The post-crisis period has brought about numerous new rules for financial stability, representing a new road of protection for all institutions in case of similar financial disturbances.

Establishing a Robust Regulatory Framework

Transitional countries like Bosnia and Herzegovina face challenges in establishing a robust regulatory framework. According to Mujo Vilašević, Regulatory Compliance Associate at Sparkasse Bank dd BiH in Sarajevo, Bosnia:

“The post-crisis period has brought about numerous new rules for financial stability, which represent a new road of protection for all institutions in case of similar financial disturbances.”

Key Aspects of the Compliance Function

The Federal Banking Act and the Banking Act of Republic of Srpska have formalized the Compliance function within banks. The acts define the Compliance function as a control function in banks, alongside Risk Management and Internal Audit functions. Key prerogatives of this function include:

• Ensuring compliance with banking regulations and standards
• Identifying potential risks and non-compliance issues
• Advising management on regulatory matters
• Assessing the impact of regulatory changes on business operations

Emphasis on Business Ethics and Good Business Practices

While regulatory compliance is a critical aspect of the Compliance function, some bylaws in Bosnia and Herzegovina emphasize the importance of business ethics and good business practices. Employees of the Compliance function, as well as others, are expected to:

• Know the rules of the profession
• Practice good business ethics
• Uphold high standards of conduct

Investing in Comprehensive Compliance Training Programs

To meet these expectations, banks in Bosnia and Herzegovina are investing in comprehensive compliance training programs. These programs aim to equip employees with the knowledge and skills necessary to navigate complex regulatory requirements and maintain high standards of ethics.

By prioritizing compliance training, banks in Bosnia and Herzegovina can ensure they remain competitive, mitigate risks, and contribute to a stable financial system. As Vilašević noted:

“Compliance training is essential for banks to serve the community and develop as a business.”