PRESS RELEASE
Decisions by the Supervisory Council, 5 June 2019

In the meeting on 5 June 2019, the Supervisory Council of the Bank of Albania reviewed and decided to:

• Approve the Regulation “On macro-prudential capital buffers”

This Regulation lays down the framework for the implementation of macro-prudential capital buffers, as instruments for the implementation of macro-prudential policy, in compliance with the definitions set out in The Macro-prudential Policy Strategy. These capital buffers include the conservative capital buffer, countercyclical capital buffer, capital buffer for systemically important banks, and capital buffer for systemic structural risk.

These capital buffers aim to strengthen banking system resilience to systemic risks of both cyclical and structural nature, and dampen the procyclicality in financial intermediation. In accordance with the Regulation, banks shall complete the macro-prudential capital buffers gradually, over a 5-year period, starting from March 2020.  The Regulation provides two methodologies detailing their application.   

Both the Regulation and the methodologies were subject of consultations with banking industry and public for a nine-month period.

The approval of this Regulation and the accompanying methodologies are fully approximated with the relevant European Union standards.

• Approve the Regulation “On valuation for purposes of resolution”

The Regulation lays down the criteria, conditions and manner of selection of the independent valuer by the Bank of Albania and the fundamental requirements for the manner of conducting valuations for purposes of resolution. Also, this Regulation aims to set out the methodology for assessing any difference in the treatment of shareholders and creditors, and whether they would be in a more favourable position had the entity been subject to compulsory liquidation instead of resolution, as well as the relevant methodology for the valuation of liabilities arising from derivatives.

• Revoke the licence granted to Credit Bank of Albania, sh.a.

The Supervisory Council decided to revoke the licence granted to Credit Bank of Albania sh.a., as this bank has started the voluntary liquidation process.

Also, the Supervisory Council reviewed the Supervision Report 2018, which addresses banking supervision functions, main activities of the Bank of Albania in this field, and details the developments in the legal and regulatory frameworks throughout 2018.  The Supervision Report 2018 analyses the activity of the banking system and its indicators, and qualitative and quantitative developments in Albania.

The Report will be presented to journalists and subsequently published on Bank of Albania's website.

The Supervisory Council was also informed on daily functional and operational activities of the Bank of Albania.