TIRANA (Albania), February 15 (SeeNews) – Albania's central bank governor Gent Sejko has said it will aim to reduce the use of the euro in the financial and economic activities in the country by 10% in the coming 3-5 years.
The high level of use of the euro in Albania curbs the effect of the monetary policies of the central bank and also poses a risk to the financial stability of the country, Sejko said during a video conference streamed on the website of Bank of Albania on Wednesday.
Sejko also said the central bank will implement measures aimed to reduce the use of the euro in the economy that are part of the so-called the de-euroisation package designed to promote the use of the national currency, the lek, in economic and financial transactions.
To achieve that objective, Bank of Albania plans to raise the required reserve ratio for banks' euro liabilities to 12.5% from 10.0%, lower the required ratio for lek reserves to 7.5% from 10.0% and increase the reserve requirement for liquid assets held in euro to 20.0% from 15.0%, Sejko said.
The central bank, Sejko added, is not fighting the euro but aims to increase the use of the lek in the economy in order to strengthen the flexibility and influence of its monetary policy and consolidate Albania's financial stability.
Earlier this month, Bank of Albania decided to keep its key rate unchanged at record low 1.25%.
The non-performing loan (NPL) ratio of Albania's banking system fell to 13.2% at the end of December, from 14.3% a month earlier.