Kosovars in large loans, 87m euros do not return to banks

Most of these tools, customers have not returned at all to banks, and these loans are being considered non - reform or bad.

Kosovo's Central Bank has announced to Arbres.info that the loans released within 10 months of this year, approximately 87m euros are non-reform loans.

The credit value in September 2017 is 2.392 billion euros. The value of the non-reform credit in September 2017 is 86.935m euros. The value of loans for businesses in September 2017 is 1.533 billion euros, while on personal loans 856.6m euros”, the CEC's response reported.

Economics officials say credit policies in Kosovo are tough and not business-functioning.

Musa Limani, professor of economics, has told of honour. Info that high interest rates and the deadline of credit returns are not favourable.

“Credit policies which present an important instrument of the economic credit policy are tough in Kosovo that should really be the opposite, so credit policies in us are not functioning enough of businesses, rather, in many cases it chokes businesses precisely because of high interest rates or interest rates and returns deadlines that would be far more just and more logical economics to be opposite<1>, Limani said.

According to him, the Government of Kosovo, through the Central Bank, must take steps not to allow the huge difference in interest rate for loans and deposits.

“Commercial banks make extra profits, make big profits, so if the Government wants credit policies in the future to be in the function of businesses and to be influenced by internal economic development it needs to change the environment, and change credit-giving conditions, and they need to have the softest loans in the sense that interest rates are significantly lower and the deadline to be longer, said Limani expert.

Meanwhile, for economic expert Ibrahim Rexhepi, the current level of non-performing loans is not very disturbing.

When we consider the overall level of loans, as well as the business environment, then the level of bad loans is not disturbing. Banks have the financial potential to cope with this level and it has so far not affected the worsening stability of the banking system. Also, in spite of all circumstances, compared to the countries in the region, Kosovo still continues to have this lower turnout of bad loans”, Rexhepi has said.

According to him, non-recognition of loans from citizens or businesses affect unstable circumstances and the inability to project real financial power for the future.

The private sector work contracts are unstable, so it happens that creditors lose their jobs, no matter how much credit access is based on the income it does. Or, it could be the deterioration of the businesseering, because of the unstable market, and this risks meeting its obligations to banks”, it has indicated.

Rexhepi has said that banks should take preventative measures through which the borrower is in place rather than take punitive measures to make the situation worse.