Albania has been granted a new loan of 100 million dollars from the World Bank intended to support the strengthening of the financial sector.
The decision was approved by the Board of Executive Directors of the Bank.
Beneficiaries of the loan will be banks and savings and credit associations, while the main aim is to enhance the flexibility of their lending to the economy.
After the loan approval in Washington, World Bank Director for Western Balkans Ellen Goldstein said that reforms supported by this project aim to address the current vulnerabilities of the financial sector by increasing its flexibility.
According to Goldstein, these reforms will create the right environment in order for banking and non-banking financial institutions to extend loans to the private sector, and this, in turn, is expected to be a drive for a better economic growth in Albania.
The project is structured around three main pillars: the adoption of measures to reduce bad loans and to strengthen the network of financial safety; strengthening regulations, supervision regimes and solving the problems of banks and savings and credit associations; and strengthening the rules and supervision of investment funds.
Part of the new project is the legal package initiated by the government and the authorities of the banking sector with a view to reducing non-performing loans.
Among other things, this package includes the new law on bankruptcy, the law for the recovery and emergency intervention in banks, a new law on associations of savings and credit, amendments to the law on auditing, law on deposit insurance, law on collective investment enterprises, code of civil procedure and the law on private bailiffs.
The Loan for Developing Financial Sector Policies is an IBRD loan with a fixed interest, while the terms include an 8-year grace period and a repayment period of 31 years.