Bosnia’s bank assets rise 2.7% y/y to EUR 11.5bn at end- May 2013.

By bne IntelliNews July 8, 2013

The total assets of Bosnian commercial banks inched up 2.7% y/y to BAM 22.4bn (EUR 11.5bn) at end-May, easing from a 3.2% rise the month before, due to slower corporate and household lending growth, central bank data showed. The reading accounted for 81% of the full-year GDP forecast, down from 83% of GDP a year earlier.

Total loans grew 3.1% y/y to BAM 16.2bn at end-May, after increasing 3.6% a month earlier. They accounted for the bulk (72%) of bank assets.

Corporate loans, which has been the main driver of Bosnia’s loan growth since the end-2012, grew 3.1% to BAM 8.4bn (51% share in total loans), cooling from the 3.6% increase at end-April. Rising long-term loans in local currency continued to support the overall corporate lending growth whereas short and long term corporate FX loans remained in the red at end-May for a seventh straight month.

End-May’s retail loans inched up 1.1% to BAM6.8bn, easing from the 1.4% rise the month before. Moderate household lending growth likely reflects rising unemployment (at over 44%) and stagnating real wages.

Banks foreign assets, which have been declining in annual terms since June 2012, plunged 17.7% y/y to BAM 2.4bn at end-May after shrinking 10.1% the month before.

Bosnia’s lending growth will likely flatten at 4% in 2013, the same as the year before, due to high share of non-performing loans (at 13.8% at end-March) and sluggish deposit growth, according to the latest forecast of the government Directorate for Economic Planning (DEP). Credit growth is expected to quicken in the mid-term, supported by improved deposit collection and rising investment which will boost credit demand.

Related Articles

Freedom House keeps “partly free” status for Macedonia despite new government’s efforts

Macedonia was rated only “partly free” in the latest report from international watchdog Freedom House, the same almost all of the six Western Balkan countries, despite efforts by the ... more

World Bank loan aims to revitalise Republika Srpska's little-used railways

The World Bank said it is lending $51.3mn to Bosnia & Herzegovina’s smaller entity, Republika Srpska, ... more

Bosnia’s constitutional court allows policemen to keep their beards

The constitutional court of Bosnia & Herzegovina ruled on November 30 that a regulation obliging border policemen to shave their beards violates their ... more

Dismiss