18/12/2019

Countercyclical Buffer Rate for the Republic of Serbia Kept Unchanged

At its meeting of 12 December 2019, the NBS Executive Board decided to keep the countercyclical capital buffer (CCyB) rate for the Republic of Serbia at 0%.

As part of its responsibility to set measures and activities aimed at maintaining and strengthening financial stability, and based on the Decision on Capital Adequacy of Banks (RS Official Gazette, Nos 103/2016 and 103/2018), the NBS calculates on a quarterly basis the reference guide based on which it sets the CCyB rate for the Republic of Serbia.

The reference guide is calculated based on the deviation of the credit-to-GDP ratio from its long-term trend. September 2019 data show that the share of total loans in GDP equalled 76.0%, while the estimated credit-to-GDP gap was -6.3 percentage points. Though rising, the estimated credit-to-GDP gap is still below its long-term trend. The closing of the gap in some segments of household lending called for targeted measures to contain this risk without generating undesired effects on the overall lending activity. The NBS Executive Board therefore adopted a set of regulations late last year with a view to preventing new NPLs in the banking sector and pre-empting potential consequences for financial stability.

Additional information about the CCyB and the explanation for the above decision are available on the NBS website, under Financial Stability, Capital Buffers.

Financial Stability Department