Financial Crime World

BOSNIA AND HERZEGOVINA’S FINANCIAL REGULATORY BODIES SHOW PROGRESS, BUT SHORTCOMINGS REMAIN

Overview

Sarajevo, Bosnia and Herzegovina - The banking sector in Bosnia and Herzegovina has seen significant improvements in its regulatory framework and supervisory processes since the last assessment in 2006. However, despite progress made by supervisory authorities, several shortcomings remain.

Progress Made

According to a recent Technical Note published on August 3, 2015, both the Agency for Financial Institutions Supervision (AFIS) of Bosnia and Herzegovina and the Central Bank of Bosnia and Herzegovina have been working to enhance their regulatory powers, resolution tools, and consolidated supervision. The banking agencies are in the process of drafting a new Law on Banks that aims to address these deficiencies.

Key Developments

  • Risk Management Regulations: Comprehensive regulations on risk management have been developed and are expected to fill remaining gaps highlighted by this assessment.
  • Improved Supervisory Processes: Supervisory processes have improved, with a more robust regulatory framework in place.
  • Enhanced Resolution Tools: Resolution tools have been enhanced to address potential crises.

Areas for Improvement

The Technical Note highlights several areas that require further attention, including:

Enhancing Supervisory Powers and Consolidated Supervision

  • Strengthening Regulatory Framework: The regulatory framework needs to be strengthened to ensure effective supervision.
  • Consolidated Supervision: Consolidated supervision needs to be improved to address potential risks.

Conclusion

Bosnia and Herzegovina’s financial sector is critical to the country’s economic growth, and these developments are expected to contribute positively towards stability and confidence in the banking sector. As the country continues to move forward with implementing new regulations and strengthening its regulatory framework, it remains committed to ensuring a stable and secure banking environment for all stakeholders.

  • Technical Note: Country Report No. 2015/214, provides an update on Banking Sector Supervision Core Principles Implementation in Bosnia and Herzegovina.
  • [Source URL]: Download the report from this link.