Preserved financial stability


The issue of banks inadequately managed before 2012 was resolved, producing no consequences for financial system stability. Due to problems in operations caused by inadequate management and supervision before 2012, in the 2012–2014 period the NBS was forced to close four banks – Nova Agrobanka, Razvojna banka Vojvodine, Privredna banka Beograd and Univerzal banka Beograd. This has enabled the restoration of full confidence in the banking system, and all relevant banking indicators are now well above the regulatory requirements of the NBS.

During the term of Governor Jorgovanka Tabaković, the inherited high level of NPLs of around 20% was cut to an all-time low of around 3% thanks to joint institutional efforts the solve issue of NPLs. The banking sector ceased to be a fiscal risk and a possible burden on public finances, while a significant drop in NPLs encouraged lending growth and thus became one of the generators of economic growth and support to economic progress and higher living standards in Serbia.

The consolidation of the banking sector was successfully implemented in the face of numerous challenges. Thanks to a responsible approach of the NBS, banking sector consolidation was successful and stability was preserved even in the conditions of changes in the operations of some parent banks (e.g. during the “Greek” crisis of 2015, the coronavirus pandemic or the Ukraine conflict). That the local banking market is attractive is also reflected in the fact that the NBS issued 31 prior consents to the acquisition of ownership in banks and 10 consents to mergers during this period. The number of banks decreased from 33 to 20, with constant enhancement of the quality and scope of services provided to households and corporates.

Confidence in the banking sector has been preserved. This confidence is clearly reflected in:

  • the rise in both dinar and FX savings to their record-high levels – from below RSD 18 bn at end-2012 to over RSD 158 bn at present (dinar savings), and from EUR 8.3 bn to EUR 14.9 bn (FX savings);
  • two greenfield investments realised in 2014 and 2016 – Mirabank and the Bank of China Serbia, as a result of improved political and economic cooperation with China and the United Arab Emirates, which helped diversify investments in the banking sector and further enhance economic cooperation with the investors’ home countries;
  • the 2019 European Commission’s assessment of equivalence of the regulatory and supervisory framework for banks in the Republic of Serbia, as the first non-EU country of the region, with that of the EU.

Regulatory support during the pandemic. Against the backdrop of the pandemic and the pronounced negative effects of global shocks, we adopted measures providing support to households, corporates and the financial sector.

Regulatory facilities for clients facing difficulties with loan repayment. The NBS adopted numerous measures facilitating loan repayment for citizens in financial distress due to the pandemic, rising inflation, higher interest rates, etc.

Positive trends in the insurance market. In the past 12 years, a positive trend has been recorded in all relevant parameters of the insurance market, with the capital, total assets, technical provisions, life and non-life insurance premiums more than doubling, thus contributing to the generally positive trend of the per capita premium and its share in GDP. The per capita premium increased from EUR 75 in 2012 to EUR 199 at end-2023, and the premium to GDP ratio from 1.6% to 1.9%.

* The latest available data at the moment of the preparation of the brochure.