financial stability report - Banka Qendrore e Republikës së Kosovës

Number 3
Financial Stability Report
from 10.6 percent in the last quarter of 2011 to 11.3 percent in the second quarter of 2012.
Spain, Greece, and Portugal besides leading the list regarding unemployment rate, are also
the countries in which unemployment has increased mostly in the first half of 2012
compared to 2011 (Figure 2). On the other hand countries like Germany and Austria in
addition to having the lowest level of unemployment rate are among the countries that
have managed to further decrease the unemployment rate in the first half of 2012.
The slowdown in export growth in the global level in 2012 is expected to result in the
deterioration of the current account. Export of goods in the global level is expected to grow
by 7.3 percent in 2012 compared with the growth rate of 7.9 percent in 2011. The increase
of exports is expected to experience a larger slowdown in the eurozone countries (from 6.1
percent in 2011 to 1.4 percent in 2012) and in the U.S. (from 7.4 percent in 2011 to 4.2
percent in 2012), while the average growth rate of exports in all other countries of the world
is expected to have a slight decrease (from 8.0 percent in 2011 to 7.8 percent in 2012).
Despite this, the eurozone is expected to increase the level of the current account surplus
from 0.4 percent in 2011 to 1.1 percent of GDP in 2012, and the United States is expected to
have the same degree of current account deficit as in the previous year 3.1 percent of GDP,
while the current account surplus is expected to decline in developing countries from 1.9
percent in 2011 to 1.3 percent of GDP in 2012.
Box 1. The performance of the foreign banking groups operating in
Kosovo 1
ProCredit Holding – PCH (Germany)
ProCredit Holding’s main financial indicators marked a significant increase in 2011, despite the fact
that the growth rate in the global
economy declined, and most of the
Eurozone countries experienced
recession. The value of total assets at
the end of 2011 amounted to euro 5.49
billion, marking an increase of 5.9
percent compared to 2010. Gross loans
to non-financial sector, which account
for the largest share of PCH’s assets,
reached a value of euro 4 billion as a
result of 10.3 percent annual growth,
while the value of deposits amounted to
euro 3.4 billion, recording growth of 5.9
percent compared with the previous
year.
Figure 3. Cost-to income ratio for banking groups,
in percent
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2008 2009 2010 2011
ProCredit Holding Raiffeisen International NLB Group
Source: Annual Reports of appropriate banking groups
The cost to income ratio has also improved. In 2011, this ratio dropped to 74.6 percent, recording a
decline of 6.7 percentage points (Figure 3). This improvement was due to the increased business
volume, and the measures taken to improve efficiency which in the one hand resulted in 7.11 percent
increase in operating income (euro 405.9 million), and on the other hand lead to a 2.11 percent decline
in operating expenditures (euro 348.6 million).
1 Analysis will include only the banking groups of the three largest banks operating in Kosovo.
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