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English   Srpski  Home page > News archives > ASB Assembly Session

ASB ANNUAL ASSEMBLY SESSION: THE BANKING SECTOR AND THE ASSOCIATION OF SERBIAN BANKS IN 2017


The Annual Assembly Session of the Association of Serbian Banks, held on 25 April 2018, was attended by numerous representatives of the banks, the National Bank of Serbia, the Belgrade Stock Exchange, the Securities Commission, the Deposit Insurance Agency, the World Bank’s Office in the Republic of Serbia, the Development Fund, ChipCard and other distinguished guests. The session was opened by Dr Goran Pitić, President of the ASB Board of Directors, who thanked the relevant departments, expert committees and the ASB Secretary General for the successful cooperation with the banks in the previous year and expressed his satisfaction with the fact that, despite the challenges in the banking sector, all the principles of good business practice have been maintained.

The Annual Assembly Session was opened by Dr Goran Pitić, President of the ASB Board of Directors
and President of the Board of Directors of Societe Generale Bank Serbia a.d. Belgrade
Working Chairmanship: Vladimir Medan, Komercijalna banka a.d. Belgrade, Mirko Španović, Addiko bank a.d. Belgrade
and Milan Pfandler, OTP bank a.d. Novi Sad

After the appointment of the Working Chairmanship, the minutes-keeper and the minutes’ verifiers, the attending members were addressed by Dr Veroljub Dugalić, ASB Secretary General, who briefly presented the results of the banking sector of Serbia in 2017. In the first part of his address, Dr Dugalić singled out the main indicators of domestic macroeconomic trends, noting that monetary stability and fiscal consolidation enabled the positive financial environment for the banks’ operations. Inflation, as in the previous year, remained low and stable in 2017, and moved within the limits of the allowed deviation from the NBS target (3% +/- 1.5 percentage points). Disinflationary factors in the domestic environment in 2017 were registered as positive effects of the country’s fiscal consolidation, the relative stability of the exchange rate and a longer period of low inflationary expectations, especially in the financial and economic sectors.

Despite this, Dr Dugalić highlighted the three core problems that the banking sector is still facing, i.e. the decrease of interest rates, the stagnation of lending activity and NPLs. Lending activity of banks, after a medium-term period of stagnation and decline, recorded an upward trend in 2017, encouraged by the easing of the monetary policy of the National Bank of Serbia, with the effects of increased competition among banks, the growth of economic activity accompanied by the recovery of the labour market, the fall in the country’s risk premium and low interest rates in the Eurozone. Total loan placements at the end of 2017 were nominally higher by 3% compared to the end of the previous year. The ratio of non-performing loans (NPLs) at the banking sector level, as a percentage of NPLs in the total granted loans portfolio, at the end of 2017 amounted to 10%. This indicator recorded a significant decline in relation to the end of the previous year by 7.2 percentage points, mostly as a result of the sale of NPLs when the banks noticeably cleared their portfolios from the risk-bearing assets, thus boosting their liquidity.

Dr Veroljub Dugalić, ASB Secretary General

Capital adequacy ratio, as the ratio between capital and credit risk weighted assets increased by the capital requirements for market and operational risks, at the end of the third quarter of 2017, amounted to 22.6%, NPLs coverage by provisions amounted to 133.2%, whereas the annual average liquidity ratio at the sector level amounted to 2.0. The quality of balance sheet assets and off-balance sheet items structure from the previous years was kept in 2017 as well, in terms of a high share of higher-ranked balance sheet assets and off-balance sheet items (A, B, C), amounting to 89.9% of the total classified assets at the end of the year.

In the second part of his address, Dr Dugalić compared the results of the banking sector of Serbia with those achieved by the neighbouring countries. He ended his presentation with a short overview of the Association of Serbian Banks’ operations in 2017, using this opportunity to emphasize that, traditional segments notwithstanding, the ASB’s priorities in the coming period will be digital banking, IT systems security and financial literacy.

A detail from the ASB Assembly Session

The Independent Auditor’s Report elaborates further on the operations of the Association of Serbian Banks, noting that the ASB Financial Report reflects the financial position of the ASB truthfully and objectively, on all materially significant matters as of 31 December 2017, as well as the results of its operations and its cash flow as of that date, in accordance with the accounting regulations of the Republic of Serbia, based on the Law on Accounting and Accounting Policies.

The following items were adopted at the Annual Assembly Session of the Association of Serbian Banks: the Minutes from the Annual Assembly Session of the Association of Serbian Banks held on 26.04.2017, the Analysis of the Financial Position and Financial Results of the Banking Sector of Serbia in 2017, the Report on the Association of Serbian Banks’ Operations in 2017, with the Financial Report and Auditor’s Report, the Decision on Allocation of Financial Result in 2017 and the Program of Activities of the Association of Serbian Banks with the Financial Plan for 2018.

Presentation of the ASB Secretary General - Banking Sector of Serbia in 2017

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