BOSNIAN CENTRAL BANK DECREASES THE REQUIRED RESERVES RATE TO 14%

SARAJEVO, Bosnia (October 14,2008) - Today, on October 14, 2008, the Governing Board of the Bosnian Central Bank made a decision to reduce the reserve requirements rate from 18% to 14%, the one which the commercial banks in Bosnia hold with the Bosnian Central Bank.

Although the liquidity of commercial banks in Bosnia is not jeopardised, decision on the decrease of the required reserves by 4% to the banks will provide the additional liquidity in the amount of 727 million Bosnian Marks,the Bosnian Central Bank said.

This Decision enters in force immediately and commercial banks will receive the instructions on the way of required reserves calculation in accordance to this Decision.
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BOSNIAN CENTRAL BANK ACTS ON DEPOSITORS' CASH PANIC

SARAJEVO, Bosnia (October 10,2008) - An out of the ordinary increase of withdrawals caused a temporary cash shortage in several of the biggest Bosnian banks.Faced with this exceptional situation, even the Bosnian Central Bank struggled to cover banks’ increased demands for cash, Central Bank officials said on Friday, stressing that banks’ liquidity is not jeopardized.

“Our banks do not have problems with liquidity, they have enough resources in their reserves,” deputy governor of the Bosnian Central Bank, Tariha Imamovic, told media.

“The problem was of a technical nature, because it is impossible to have so much cash in such a short period of time.”

The problem started on Thursday afternoon, in several branches of Unicredit and Raiffeisen Bank in Sarajevo, where worried customers stood in long lines to withdraw their deposits. It is still unknown whether this situation has spread to other banks in other areas in the country.

The situation appeared to be calmer today, after the Bosnian Central Bank provided commercial banks with as much cash as was available and has ordered additional resources from its deposits kept abroad, which – if needed – will be available within the next couple of days, Imamovic stressed.

The brief cash crisis on Thursday, indicated the level of nervousness among the Bosnian citizens triggered by the deteriorating global economic crisis and the fact that most of Bosnia’s commercial banks are owned and directly linked with other European big banks.

Bosnian citizens have additional reasons for weariness since many of them lost most of their savings when the banking system of former Yugoslavia collapsed in the early 1990’s.

“There is no reason for panic,” Imamovic stressed.

Over the past few weeks, local and international financial and banking experts have repeatedly stressed that Bosnia’s financial and banking systems are safe from the global financial turmoil thanks to the strong reserves of Bosnia’s Central Bank, the modernised regulatory system of the country’s banking sector, state-guaranteed small deposits, the fixed exchange rate between Bosnian Mark and Euro, as well as a conservative fiscal system controlled by the country’s currency board.
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BOSNIAN GOVERNMENT FISCAL SURPLUS WAS 278 MILLION BOSNIAN MARKS IN 2007

SARAJEVO, Bosnia (July 4,2008) - The Bosnian Central Bank released yesterday the regular annual report about the Bosnian government finances. The consolidated fiscal surplus in 2007 was 278 million Bosnian Marks, which is 1.3 per cent of the GDP.

Although 2007 saw a worsening financial situation for Bosnia, because the net surplus was almost half the 2006 surplus, current revenue was higher than current spending and public investments.

Spending was growing at the annual rate of 17 per cent, while consolidated revenues increased by 15 per cent in 2007, and totalled 9.83 billion Bosnian Marks. Public investments were significantly up (by 53 per cent), and reached 746 million Bosnian Marks.
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BOSNIAN CENTRAL BANK: BORROWING DECREASED IN NOVEMBER AND DECEMBER

SARAJEVO, Bosnia (February 28,2008) - Recent data from the Bosnian Central Bank show every Bosnian citizen has average 1,470 Bosnian Marks borrowed from banks, and the credit burden of every employed person is average 8,000 Bosnian Marks.

The Bosnian Central Bank does not find these figures worrying, and reports that borrowing slightly decreased in November and December.

By the end of December, retail loans amounted to 5.685 billion Bosnian Marks and growth rate dropped from 29.5 per cent to 28 per cent. There is no way to claim with certainty that the drop was due to required reserves ratio for commercial banks being raised from 15 per cent to 18 per cent, head of the Statistic Department of the Bosnian Central Bank said.

The banks in Bosnia still have no problem meeting this requirement, and the reserve surplus is around 750 million Bosnian Marks. Also, banks are becoming more flexible, requiring guarantors and other securities for their loans less often.
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