New EU-Funded Course on Financial Stability for Western Balkan Countries

On 26 March 2019 the European Union (EU), 18 National Central Banks from the European System of Central Banks (ESCB) and the European Central Bank launched a program for the benefit of six Western Balkans countries (Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia). The purpose of the program is to enhance the institutional capacity of the recipient institutions, notably by strengthening their analytical and policy tools and by transferring the best international and European standards into national practices. The EU has allocated € 2 million to the program from its Instrument for Pre-Accession Assistance (IPA II).

The program has two components: (i) Component I comprises 20 training events on key central banking and supervisory issues, and two high-level policy workshops, (ii) Component II consists of specific bilateral measures related to the Economic Reform Programmes (ERPs) of candidate countries and potential candidates, namely missions, study visits and internships. The Deutsche Bundesbank coordinates the activities of the program.

Against this background and as part of Component I, the Oesterreichische Nationalbank (OeNB) hosted a training event on financial stability in cooperation with De Nederlandsche Bank (DNB) and the European Central Bank (ECB). The course took place at the JVI premises during 10-12 September 2019 and aimed to offer a platform to discuss issues relevant for a balanced financial stability assessment of the EU candidate countries and potential candidates in the Western Balkans. In particular, it offered both a more structured approach to the financial stability analysis as required by the ERPs and a possibility to explore new financial stability topics that have hardly been included so far in the ERPs (see the Box). 

The three-day course consisted of contributions by distinguished experts in the field from the OeNB, ECB and IMF. The topical issues addressed included the ECB’s ERP assessments and main takeaways, CESEE households’ access to finance, assessment of vulnerabilities of household debt in CESEE, non-performing loans in CESEE, the role of macroprudential measures, and climate change and financial stability risks.  In addition, the course included a one-day workshop on bank stress testing, which was offered by the DNB, and a half-day practical session on the analysis of an already submitted ERP organized by the OeNB.

The group of 18 participants consisted of highly-qualified mid- to senior-level experts from central banks and supervisory authorities from the six EU candidate countries and potential candidates in the Western Balkans. The feedback provided by the participants was highly positive - an overwhelming majority of the participants indicated that they would recommend the course to their peers and that the knowledge and information gained from the course will add value to their jobs. As part of this EU-funded program, the OeNB will organize another training event in 2020 at the JVI. The topic of the next course will be European integration. 

Romana Lehner and Mariya Hake, Oesterreichische Nationalbank