The Croatian banking system will receive approximately EUR 850m, or approximately HRK 6.3bn for economic projects financing, based on a reduction in the rate of minimum required foreign currency claims of banks relative to their foreign currency liabilities from 20% to 17%.
The purpose of this decision, which was issued today by the Governor of the Croatian National Bank, Željko Rohatinski, and which will enter into force immediately after its publication in the Official Gazette, is to stimulate investments in new projects that could contribute to improved exports and balance of payments and job creation over the shortest possible term. It is estimated that these investments would involve mainly investments in manufacturing and tourism.
The selected projects would be financed in the context of the banking system, but fully independently from the existing A and B economy financing models that failed to produce the expected results as seen in the fact that over one half of the HRK 2bn deposited for their realisation in a special account, of the total of HRK 2.9bn released by the central bank in an effort to provide support to this programme by reducing the reserve requirements ratio from 14% to 13%, remains unused in this account to date.
Today's decision of the Governor was issued after consultations with the representatives of major banks and employers. Given the already high banking system liquidity, the additional amount that is made available for investments under this decision should facilitate loan realisation and ensure more favourable interest rates compared to those offered presently for all projects that can be realised quickly and that stand real chances of achieving profitable and competitive business operations in the domestic and foreign markets.
The Croatian National Bank will monitor the manner, dynamics and purposefulness of the use of the freed funds, and take further measures accordingly.