IMF Staff Country Reports

Bosnia and Herzegovina: Financial Sector Assessment Program Technical Note—Systemic Liquidity Management, Financial Safety Net, Insolvency Framework, and Macroprudential Policy

Publication Date:

August 3, 2015

Electronic Access:

Free Download. Use the free Adobe Acrobat Reader to view this PDF file

Summary:

This Technical Note discusses key findings and recommendations of the assessment on Systemic Liquidity Management, Financial Safety Net, Insolvency Framework, and Macroprudential Policy on Bosnia and Herzegovina. It is observed that there are constraints on the ability of both banks and the Central Bank of Bosnia and Herzegovina to manage liquidity. The system lacks a central bank liquidity window, and the secondary market for government securities is also small and illiquid. Liquidity regulations should be streamlined and the adoption of the liquidity coverage ratio would strengthen liquidity management. The deposit insurance framework is a relatively well-developed paybox scheme, but further enhancements of the deposit insurance arrangements would be beneficial.

Series:

Country Report No. 2015/216

Subject:

Asset and liability management Bank resolution Bank resolution framework Banking Bridge bank Deposit insurance Financial crises Liquidity