The Central Bank of Bosnia and Herzegovina (CBBH) and KfW Entwicklungsbank (KfW) recently co-hosted a conference about the importance of responsible business practices in the financial sector, including the microfinance sector, of Bosnia and Herzegovina. In his opening remarks, Governor Kemal Kozaric, governor of CBBH, stated: “The global financial crisis has proven that the principle of responsible finance has not been sufficiently developed with banks and with clients. It has now become evident that the liquidity risk of banks in Bosnia and Herzegovina is rather low, and that the main problem is the quality of loans.” The Governor’s remarks were framed in light of the fact that the nation’s financial sector had experienced tremendous growth over the past years, which has resulted in greater access to financial services even by the nation’s poor. Despite this growth, Sylvia Wisniwski, Chief Operating Officer of the European Fund for Southeast Europe (EFSE), emphasized in her presentation that, “Responsible lending principles must be adhered to during the entire lending cycle, starting with a prudent assessment of the creditworthiness of individual clients and continuing with a fair and transparent lending relationship.” The conference included presentations on responsible management of foreign currency reserves by the central bank, the role of stakeholders in responsible finance, and the role of the Association of Microfinance in Bosnia and Herzegovina.
Established in 1997, the Central Bank of Bosnia and Herzegovina (CBBH) is the nation’s central monetary authority and bank. It endeavors to maintain the monetary stability and controls the implementation of monetary policy of Bosnia and Herzegovina. CBBH also regulates banks and monitors the financial sector of the country. CBBH website: http://www.cbbh.ba/?id=1&lang=en
About KfW Entwicklungsbank (KfW):
KfW Entwicklungsbank is a state-owned development bank based in Germany. The main avenue used by KfW is to conduct German bilateral cooperation on behalf of the government in pursuit of three goals: to reduce poverty, to make globalization fair and to conserve natural resources. KfW website: http://www.kfw-entwicklungsbank.de/EN_Home/KfW_Entwicklungsbank/index.jsp
About the European Fund for Southeast Europe (EFSE):
The European Fund for Southeast Europe (EFSE) is a microfinance investment fund which has an investment portfolio of EUR 559 million (as of 30 September 2009). Established in 2005, the EFSE’s goal is to foster economic development and prosperity in the Southeast Europe region and neighbouring countries. To that end, the EFSE offers long-term funding instruments to qualified local financial institutions for on-lending to micro and small enterprises (MSEs) and low-income private households. EFSE website: http://www.efse.lu/
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