In a press release, BoA emphasizes that, with maximum appreciation for the concern of the President of the Republic and with the responsibility to inform the public accurately and correctly, the Bank of Albania clarifies that it has always fulfilled its constitutional mission: maintaining price and financial stability in the country.

“Through our measures and actions over the years, we have contributed to Albania successfully coping with the repercussions of overlapping financial crises, we have enabled the non-performing loan to decrease 5 times within the last decade, dropping to an all- time low, we have radically improved the regulatory framework with view to consumer protection, resulting in loan interest rates decrease by 3 times within the last 3 years, but above all, we have guaranteed the financial health of the country, securing the savings of millions of citizens”, the press release reads.
The legal mandate of the Bank of Albania, the press release reads, is to maintain price and financial stability in the country.
For this purpose, in September 2015, the “National Plan for the reduction of non-performing loans” was approved. It was signed by the Prime Minister of Albania and the Governor of the Bank of Albania and assigned a series of tasks for government institutions and the Bank of Albania . One of the tasks of the Bank of Albania was the licensing of companies that would engage in the purchase and administration of non-performing loans, a solution fully in compliance with the provisions of the Civil Code.
According to the Central Bank, the regulation made by the Bank of Albania in 2016 did not affect the licensing of entities already equipped with a lending license, but made it possible for the activity of purchasing only nonperforming loans to be framed in line with the regulatory requirements of the Bank of Albania (reporting, supervision, etc.).
In terms of licensing, this regulation introduced change only for new institutions that could enter the market, whose portfolio would consist 100% of non-performing loans only.
These changes, in addition to the fact that they were an assignment laid down in the “National Plan for the reduction of nonperforming loans” of 2015, came as a necessity also for the reason that: the loan is a financial product and this product must be transferred to the subjects licensed by the Bank of Albania; it is mandatory to fulfill the regulatory requirements for reporting data in the Credit Registry in order not to penalize citizens to meet their credit needs; risk management through on-site inspections and external analyses, as well as periodic reports to the Bank of Albania are of high importance; and the Bank of Albania pays undivided attention to the consumer in terms of transparency, protection from abusive activities and mediation in handling borrower complaints.
So, the Bank of Albania, has neither allowed nor created illegitimacy in any case, but has only further improved the supervisory regulatory framework for the purchase of nonperforming loans.
The Bank of Albania, in compliance with all regulatory criteria and legal requirements, based on in-depth risk analysis, as well as with the assistance of international partners and the cooperation of institutions in the country, licensed the entities that fully met regulatory criteria.
In the follow-up, during the entire period these companies exercised their activity, the Bank of Albania has performed its supervisory function with full professionalism, in compliance with legal and regulatory obligations. From the moment of licensing, all these entities have been subject to periodic inspections by the Bank of Albania, and specifically, continuous external inspections, full and partial examinations, as well as 3-month monitoring of financial statements and indicators reported by them.
Throughout this process, the Bank of Albania has taken appropriate supervisory measures whenever necessary, which, in the most recent cases, have escalated to the revocation of the license of entities that, during the exercise of the activity, had breached the defined regulatory obligations from the Bank of Albania.
On the other hand, materialized in the decision-making of the Supervisory Council of the Bank of Albania, a series of institutional initiatives have also been undertaken, which have directly impacted consumer protection, such as: limiting the amount of penalties forced to be paid by borrowers in arrears of no more than 30% of the total amount of the remaining loan liability; setting a maximum interest rate limit; removing the payment of a penalty in case of early repayment of some of the loan categories; removal of the fee for obtaining the borrower’s report from the Credit Register administered by the Bank of Albania for borrowers; etc.
Meanwhile, with the assistance of the World Bank, work is underway to review the supervisory regulatory framework, with a particular focus on consumer protection in the activity of non-bank financial entities.
At the same time, the Bank of Albania has continued to seriously examine and handle any complaint against the entities supervised by it. What has dominated during this process is the fact that the largest number of complaints received by the Bank of Albania from the clients of these companies is related to the mandatory execution process. This fact is confirmed even today, when a dedicated working group within the Bank of Albania is handling the complaints of borrowers of financial institutions whose license has already been revoked.
In this context, the Bank of Albania has no authority to order the prohibition/suspension of the processes of execution of obligations, as this is a competence that is recognized by law only to the competent court. The legal authority of the Bank of Albania ends the moment a court decision is delivered and an execution order is issued to recover the unpaid loan. Any process beyond this moment (auctions, imposition of seizures or any other procedural action undertaken by the enforcement company) is outside the legal powers of the Bank of Albania and cannot be followed or regulated by it. We take the opportunity to reiterate that credit contracts and relationships or disputes between creditors and customers are the exclusive subject of the Civil Code and the Code of Civil Procedure that prevail over any law or regulation of the Bank of Albania and as such are the exclusive subject of the judicial bodies.
Likewise, the activity of the enforcement service, whether organized as a state or private service, is not licensed or overseen by the Bank of Albania. As a result, the activity of the enforcement service is not subject to the control of the Bank of Albania and the Bank of Albania has no authority to intervene.

Having said the above, BoA wants to assure the public and declares with full responsibility that the Bank of Albania, pursuant to its legal duties, has continuously performed, with precision, professionalism, integrity and focus on consumer protection, all its supervisory and regulatory functions, within all the spaces attributed to it by the laws in effect. The function of the Bank of Albania is to supervise and regulate that part of the financial market within the powers recognized by law, as well as to address unwanted phenomena with comprehensive solutions at the systemic level, finding the best possible balance between maintaining financial stability and consumer protection.

In any case, the Bank of Albania has cooperated and will continue to cooperate closely with all justice bodies, to clarify every aspect of its role. At the same time, we remain open to provide all necessary input, information, and clarifications, considering full transparency and accountability to all parties, especially the public, a key element of its credibility and very important in fulfilling one of its legal mandates, that of the country’s financial stability”, the press release reads.
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