TABAKOVIC: No unreal expectations and fast decisions on loans in Swiss francs

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The National Bank of Serbia (NBS) does not support abrupt solutions when it comes to loans repayment in Swiss francs, the governor Jorgovanka Tabakovic has said today.

She announced NBS reps will discuss it at the meeting next week.

The objective of NBS is not to heat unreal expectations but, as a regulator, show responsibility, she said.

- Model, first of all, should be applicable to the market and to refer to residential loans indexed in Swiss francs – she said.

The governor said that regulators at other markets have not reached optimal solution yet and therefore it is necessary, she thinks, to carefully consider all advantages and disadvantages of alternative models.

The objective is to have a simple model so that it could be easily implemented in practice.

She mentioned that the Executive Board at NBS has been carefully considering today influence of Swiss franc when it comes to financial system stability as well as the methods how to facilitate citizens loan repayment in this currency.

As the governor said, they discussed options of loan restructuring on individual basis through conversion of loan indexed in Swiss francs in euro to the option of alignment of interest rate with market conditions.

Still, Tabakovic underlined that everything will be discussed with bank reps on Monday.

When asked whether Serbia could use Hungarian model, the governor said it was not possible.

She added that solutions which have been used in the countries of the region in Serbia would make NBS behave as a mandator and banks would withdraw from Serbian market which is not the objective.

She also estimated that these solutions were represented as permanent but that in fact they are just “delay of the right solutions”and are conditioned with, as she says, with political circumstances.