CBK welcomes the positive assessments of the EC on the stability of the financial sector and the advancement of its institutional reforms
The Central Bank of the Republic of Kosovo (CBK) welcomes the European Commission's positive assessments of the financial sector in the Kosovo Report for 2025. This report highlights that the country's financial sector has maintained high stability, increased capitalization, and made significant progress in aligning with European Union standards.
According to the report, Kosovo’s banking sector continued to expand at a steady pace, while maintaining sufficient levels of capital and liquidity. The report highlights the increase in banks’ regulatory capital significantly above the required minimum, while the non-performing loan ratio remained at a historically low level. The report assesses the adoption of the Regulation on Macroprudential Capital Add-ons and the plan for the implementation of the Supervisory Review and Evaluation Process (SREP), in line with the guidelines of the European Banking Authority (EBA).
In the area of payments, the report highlights the progress made with the adoption of the Law on Payment Services and the CBK's membership in the European Association of Automated Clearing Houses (EACHA), which enables direct cooperation with the central banks of EU countries to advance payments. The report also highlights the increase in electronic payments in number and value during 2024, as well as the expansion of financial services coverage in municipalities in northern Kosovo.
The European Commission appreciates the active role of the Central Bank of the Republic of Kosovo in the fight against euro counterfeiting, highlighting the concrete measures taken to strengthen the mechanisms for the prevention and detection of counterfeit currencies. The CBK has taken steps to improve the handling of counterfeit euro coins and to increase cooperation with local and international institutions in this field, in line with European Union standards.
The CBK was also positively assessed for its steps towards digitalization and the development of sustainable finance. It highlights the adoption of an action plan for managing climate and environmental risks in the financial sector, as well as the strengthened cooperation with the Kosovo Credit Guarantee Fund, which has enabled increased access to financing for small and medium-sized enterprises, supporting projects in agriculture and energy efficiency.
The report recognizes the advances in the fight against money laundering and terrorist financing through the adoption of new laws, one on AML/CFT, one on Payment Services and one on Crypto-Assets, which aim to harmonize with the fourth and fifth EU directives. The EC has highlighted the CBK’s transition from a compliance-based supervisory framework to a risk-based supervisory framework, harmonizing practices with international FATF and EU standards.
The report also recognizes the CBK's achievements in strengthening internal governance, which include completing the reorganization of the institutional structure, strengthening the human resources framework for attracting and retaining professionals, and establishing a dedicated cybersecurity division, accompanied by the adoption of the Cybersecurity Strategy 2025-2028.
While the report recognizes notable advances, it recommends that Kosovo continue efforts to advance financial data collection and analysis, develop a comprehensive framework for bank recovery and resolution, and improve financial market infrastructure.
The Central Bank of the Republic of Kosovo remains committed to continuing reforms that strengthen financial stability, institutional governance and further approximation with the European Union acquis, in line with the European integration objectives of the Republic of Kosovo, while expressing its high appreciation to the European Commission for its cooperation and support.
The full European Commission report on Kosovo for 2025:
https://enlargement.ec.europa.eu/document/download/127563ea-4c03-44a4-b56c-2d569afd86a5_en?filename=kosovo-report-2025.pdf
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