| Policy of the Central Bank of Montenegro for 2003 |
According
to the Article 17, item 1, point 1 of the Law on the Central Bank (“Off.
Gazette RMN”, No. 52/00 and No 47/01), the Council of the Central Bank, at the
meeting held on 29th November and
2nd December 2002, established the
following:
POLICY OF THE CENTRAL BANK IN 2003
Aims
of the policy of the Central Bank of Montenegro (hereinafter: the Central Bank)
for 2003 are the following:
1.
For the purpose of increasing the efficiency of the banking system,
strengthening of the financial market, and regaining confidence in the banking
system through the improvement of regulations and control frame, the Central
Bank will work on:
a.
the completion of banking operations regulations in accordance with the
international standards, especially in the field of bank control on the
consolidated grounds.;
b.
improvement of on-site and off-site control of the banks and monitoring of
harmonization of banking operations and the established standards;
c.
realization of efficient measures
towards banks that brake the established standards, including the actions of the
interim management, bankruptcy and liquidation of banks, in order to protect
creditors and deponents, that is, to prevent the negative effects on the banking
system;
d.
the policy of licensing of new banks and other financial institutions, thus
offering the highest degree of prevention and the bases for the realization of
the goals set;
e.
the improvement of presentation and the structure of banks` balances, with
special emphasis on the elimination of the
inherited bookkeeping positions set by the inefficient regulations and banking business operations;
f.
initiating bank privatization procedures or their privatization through interim
management;
g.
completion of the existing
bankruptcy procedures and liquidation of banks;
h.
preparation and implementation of the deposit protection system, after the
adoption of the proposed Law on Guaranteed Deposits;
i.
the intensification of cooperation with other regulative bodies, for the purpose
of exchanging data and experience, and improvement of cooperation with
international financial institutions and organizations in the area of reform
presentation in the banking sector and control of foreign business operations;
j.
prevention of operations of banks and financial institutions that were not
licensed by the Central Bank;
k.
intensifying of training auditors at all levels and education within the banking
sector, with special emphasis on the education regarding money laundering
prevention, the recognition of suspicious
transactions, and issues regarding
the implementation of international accounting standards and practice.
2.
The Central Bank shall intensify and complete the payment operations` reform in
the Republic through its demonopolization, for the purpose of establishing and
maintaining efficient payment operations, by the means of:
a.
transferring of services of noncash and cash payment operations services from
Payment Operations Services Department to banks, by the end of 2003;
b.
development of modern RTGS system on the basis of
previously developed feasibility study;
c.
performing the function of money distribution via a reduced network which will
consist of regional centers;
d.
transferring non-payment functions (admission, control, sorting, processing and
informing according to annual financial reports) to other authorized
institutions;
e.
licensing of banks for conducting the payment operations activities;
f.
performing the control of legality and regularity in conducting payment
operation activities in banks, in accordance with the audit plan and
methodology.
3.
The Central Bank will improve the financial system liquidity management and
foreign currency reserves management in the Republic, by the means of:
a.
usage of the instruments of
statutory reserves of banks with the Central Bank;
b.
approving the usage of statutory reserves to the licensed banks,
approving intra-daily loans from own funds or approving
loans with daily maturity;
c.
open market operations with short-term securities;
d.
managing of FX reserves of the Republic for the purpose of: (i) maintaining of
general liquidity in international payments, (ii) risk minimization, (iii)
benefit maximization;
e.
activities on the development of short-term securities market;
f.
providing necessary quantities and denomination structure of EUR as a legal
tender, and performing adequate distribution of banknotes and coins for the
purpose of satisfying the financial transactions` needs.
4.
For the purpose of more efficient operations of bankers, consultants and fiscal
agents of bodies and organizations of the Republic, the Central Bank will:
a.
render services to the Government of the Republic of Montenegro, regarding the
short-term security issuance;
b.
at least once a year or more often if necessary advise the Government of the
Republic of Montenegro in the field of economic policy, including advice on
financing the budgetary deficit and contraction of debts limits;
c.
perform payment operations in the Republic and abroad for bodies and
organization of the Republic;
5.
The Central Bank will improve cooperation with international financial
institutions, central banks, and other relevant institutions by the means of:
a.
cooperation with international financial institutions and international
creditors;
b.
cooperation with the European Central Bank and other central banks;
c.
cooperation and improvement of correspondence with other banks and banking
institutions;
d.
monitoring of inflow dynamics and the use of financial resources assigned to the
Republic at donation conferences , as well as the use of other resources from
abroad, and within its authority making the necessary preparations for the
donation conference in 2003;
e.
active participation, within its authority, in the process of joining the
European Union.
Apart
from the activities listed above, The Central Bank will continue the
negotiations with the Yugoslav National Bank regarding the division of property
and liabilities, the division of public debt and the definition of the model for
establishing payment operations between the Republics.
6.
The Central Bank will improve organization, human resources` skills and
motivation, for the purpose of increasing its efficiency, by the means of:
a.
completion of internal regulations;
b.
development of motivation mechanisms;
c.
development of human resources management system;
d.
education of personnel;
e.
improvement of technological equipment;
f.
development of information system;
g.
development of public relations strategy.
THE CENTRAL BANK COUNCIL
No.
0101-82-2002
The President of the Council
Podgorica,
27 December 2002
Ljubisa Krgovic