National Bank Gains Sweeping Powers to Regulate Banks

The newly amended Law on Banks has significantly expanded the powers of the National Bank Governor to take measures against banks, bank groups, and bank authorities that fail to comply with regulations.

Enhanced Regulatory Powers

The law allows the Governor to issue:

Recommendations

Warnings

Protocols

In more serious cases, the Governor can impose:

An interdiction on certain activities
Limit specific operations
Withdraw a bank’s permit to operate

Increased Efficiency and Accountability

The law also provides for the possibility of pronouncing misdemeanor sanctions without the need for court mediation, increasing the National Bank’s efficiency in enforcing regulations and improving conditions in the banking system.

Expanded Scope

The Law on Banks applies equally to:

Savings banks

Branches of foreign banks operating in Macedonia

Strengthening Anti-Money Laundering Programs

Separately, the National Bank has adopted a decision outlining the procedure for establishing and applying a bank’s program for preventing money laundering and financing terrorism. The decision strengthens the efficiency of anti-money laundering programs by requiring:

Enhanced client due diligence
Business relationships with high-risk clients

Amendments to the Law on Fast Money Transfer have been adopted, strengthening criteria for licensing providers of fast money transfer services. The Governor can withdraw a license in cases where there are violations of regulations related to money laundering prevention or terrorism financing.

A new decision has also been adopted outlining conditions and procedures for obtaining a license for currency exchange operations. Authorized currency exchange entities must possess a program for preventing money laundering and financing terrorism, as regulated by the National Bank’s Guidelines for implementation of the Decision on Currency Exchange Operations.

The Governor can withdraw a license if an authorized currency exchange entity fails to comply with these regulations or possesses a program that does not contain all necessary elements.

Commitment to Strengthening the Banking System

These changes reflect the government’s commitment to strengthening the banking system and combating financial crime in Macedonia.