Skopje, 29 August 2023 

The Governor Angelovska Bezhoska, together with the governors of Austria, Germany and Denmark, participated in the panel discussion “The impact of the monetary policy tightening on the financial stability” at the European Forum Bold Europe 2023, which took place in Austria.  In times of prolonged inflationary pressures, the stabilization of inflation is undoubtedly central banks’ key priority, which requires tightened monetary setup. In order to prevent risks to financial stability by the monetary policy tightening, undertaking macro and micro-prudential measures is crucial for maintaining and further strengthening of the banking system stability.  By undertaking precautionary measures, prior to or during the monetary tightening, we strengthen the capital and liquidity of banks and we provide more space for central banks in dealing with inflation.  

In her discussion, the Governor Angelovska Bezhoska said that historically observed, the global monetary setup is the most synchronized and the strongest monetary policy tightening in the last five decades, in order to anchor inflation expectations and to reduce the inflation rate.  But, higher interest rates may increase the credit risk and cause growth of non-performing loans.  This is not the case so far, given that in Europe and in CSE region they are kept below the level of 4%, which is significantly lower compared to the pre-pandemic period.  The non-performing loans in our country are even lower-2.8%.

Also, as a result of the global regulatory reform, which was also carried out by the National Bank, we took multiple measures to significantly strengthen the capital and liquidity of the banking system in order to mitigate possible risks.  The capital adequacy is the highest in the last decade.  Last year, a countercyclical capital buffer was introduced for the first time, and this year macro-prudential measures aimed at loan demand quality were introduced for the first time as well. However, the Governor pointed out that it is especially important to continue with further strengthening of the macro-prudential and micro-prudential framework, as well as enhanced cooperation with the competent EU institutions since most of the assets of the banking system belong to EU banking groups. Hence, greater involvement in the supervisory colleges and resolution colleges, organized by the EU institutions, would be crucial for the exchange of information and taking consistent and coordinated activities. 

At the end of the event, the Governor had a fruitful discussion on the challenges of our economy with the scholarship students from our country who attended the Forum.

The European Alpbach Forum, Austria, which was founded in 1949 is a place that unites young people from Europe and the entire world, with the most innovative people in politics, business, civil society, culture and science in order to foster ideas for strong and democratic Europe.  With this diverse, intergenerational and interdisciplinary community, the Forum influences the key participants throughout the European continent to facilitate their learning and decision-making.