The Council of Ministers of Bosnia and Herzegovina (BiH) has accepted the initiative to conduct negotiations for the conclusion of a Credit Agreement between BiH and the European Bank for Reconstruction and Development (EBRD) for Credit Line III intended for the Deposit Insurance Agency of BiH, in the amount of 30 million euros. The Ministry of Finance and Treasury of BiH is tasked with, upon completion of the negotiations, submitting to the Council of Ministers the draft credit agreement and the basis for its conclusion.
The Board of Directors of the Deposit Insurance Agency of BiH adopted a decision on February 27th, 2025, approving a possible future borrowing of 30 million euros from the EBRD through a stand-by arrangement. Based on this, the Agency submitted a request to the Ministry of Finance and the Treasury of BiH to initiate the procedure that would create an obligation under external state debt. The recommendation of the International Monetary Fund mission is also that the Agency continuously has an available credit line.
The aim of this arrangement is to ensure the rapid availability of funds for the protection of deposits of natural and legal persons in banks in case of potential problems in financial institutions. Since the Deposit Insurance Fund does not have a legal possibility to rely on the budget or the Central Bank of BiH (CBBiH), such a stand-by line represents an effective mechanism for strengthening confidence in the banking sector and maintaining overall financial stability in the country.
The credit line amounts to 30 million euros, with an availability period of five years. This initiative represents a continuation of successful cooperation, given that the existing credit line expires in October 2025, while the previous one was active from 2010 to 2017.
It is important to emphasize that previous credit lines were never activated, which confirms the stability of the domestic banking sector and the adequate capitalization of the Deposit Insurance Fund. Securing such an arrangement simultaneously represents a step toward further alignment with European Union (EU) directives on deposit insurance systems.
