Skopje, 28 January 2023

The denar remains stable, and there are no pressures expected on foreign reserves in the following period. The soundness of the banking system is preserved, whereby the capitalization is adequate and stable, while the non-performing loans remain at a low level. This is stated in the Standard & Poor's Agency Report, which confirms the credit rating of the country BB- with a stable outlook.

The Agency points to favorable trends in foreign reserves, which at the end of 2022 reached euro 3.9 billion. As concluded by the Standard and Poor’s, in the past months the prices of energy have stabilized, therefore there are no expectations for significant pressures on foreign reserves during the year. In addition, according to their expectations, the reserves will continue to grow, amid account deficit and expected narrowing of the current financial inflows through direct investments. The exchange rate remains stable and no changes are expected in the denar exchange rate.

The Report on the credit rating of our country by Standard & Poor's indicates that unlike other countries in the region, the relations of the financial sector of the domestic economy with Russia are poor, so there are no direct negative spillover effects in the domestic banking system from the crisis. In terms of the banking sector, the Agency emphasizes its stability, in conditions when the non-performing loans remain low, at the level of 3.2%, while the capitalization rate of the banking sector is adequate and equals17.7%.

The Report emphasizes the measures taken by the National Bank in terms of liquidity, changes in the interest rate policy and reserve requirements, as well as macroprudential measures.  Moreover, it emphasizes their role in stabilizing the inflation and inflationary expectations, supporting the process of denarization of the economy, as well as further strengthening of the banking system resilience.