PRESS RELEASE
PRESS RELEASE

Recently, some media outlets have reported that commercial banks have improperly benefited from the handling of damaged and unfit banknotes. Related to this issue, the Bank of Albania would like to inform the public that this is untrue.

The Bank of Albania administers the unfit banknotes for circulation in compliance with well-defined rules, recently approximated to European Central Bank standards. The rules that govern the exchange of damaged banknotes are broadly in line with those applied for euro banknotes, in accordance with the Decision of the European Central Bank of 19 April 2013 (ECB/2013/10). European experts have assessed that the processes and regimes implemented by the Bank of Albania on the denominations, specifications, reproduction, exchange, handling of damaged and unfit banknotes and their withdrawal are conform to the European ones.

The practice of handling the unfit banknotes for circulation, which is also verified by on-site inspections carried out at commercial banks, evidences that there has been no fact or case supporting the recent comments made in the media. Moreover, the media reports that commercial banks have compensated their clients for only 80% of the value of the damaged banknotes submitted to the Bank of Albania for destruction and that, in turn, these banks have been compensated at 100% of the value by the Bank of Albania, are untrue.

The Bank of Albania has performed all the necessary relevant verifications set out in the Regulation "On the transparency for banking and financial products and services", through inspections at commercial banks. The examination did not reveal any commission held by the banks to evidence that a 20% penalty had been withheld for the damaged banknotes. In addition, no complaint has been lodged by any client of the banks inspected by the Bank of Albania in this regard. The processing procedure is thoroughly documented.

Based on the above analysis, the Bank of Albania is confident that neither the state budget nor the bank clients have incurred any damage from the exchange of damaged banknote at commercial banks.

The Bank of Albania has addressed the cited report of the Supreme State Audit through official communications between the two institutions.

The Bank of Albania is fully committed to guaranteeing the qualitative functioning of the issue and circulation of the national currency, in full compliance with the laws of Albania and international standards.