Bankieri Publication No. 36 July 2020 AAB MEMBERS www.aab.al CONTENT Editorial From lockdown to open up: the road to confidence Prof. Asoc. Dr. Elvin MEKA 5 Bankieri No. 36, July 2020 Frontline Publication of Albanian Association of Banks Challenges for entrepreneurship and government support, during COVID-19 pandemic Eduard SHALSI, Minister 6 Monetary policy as a monetary control and economic stabilization instrument Erald THEMELI 8 Banks striving for a strong growth and recovery Bankieri Burçak INEL 11 COVID 19 – The Open Up Dr. Spiro BRUMBULLI 13 Banks in front of COVID-19 16 Intervista AFSA – A new management for actual and incoming challenges Ervin METE 24 Banking System Banking of the future: challenges, vision and strategies Prof.Dr.Adrian CIVICI 26 Automatic Exchange of Information What does it mean for Albanian and the Albanian banks Enkelejda TOTO 29 ICT – a key element of success in overcoming the Covid-19 pandemic situation Alketa LAMÇE 31 Internal Audit Challenges, during Covid-19 crisis Dorida STAMBOLLA 33 Experts's Forum Beyond Covid –19: New opportunities for the Albanian FinTech-sector Jonida KËLLEZI 36 Trainings – challenges and opportunities during pandemics EDITORIAL TEAM: Junida TAFAJ 39 Elvin Meka Social Development Goals 40 Editor-in-Chief Eftali Peçi AAB: Activities - Trainings 44 Coordinator Dorina Zarka Photographer Design & Layout: FCB Afirma Printed by: Bankieri is the official publication of EDITORIAL BOARD: the Albanian Association of Banks which mainly focuses on the Albanian Silvio PEDRAZZI Georgios PAPANASTASIOU Adrian CIVICI AAB Chairman & CEO AAB Executive Committee Dean, Faculty of banking industry. Bankieri provides of Intesa Sanpaolo Bank Member & CEO Economics, Mediteranean readers with valuable information on Albania of Alpha Bank Albania University of Albania the financial industry's developments in general, and of commercial banks Maltin KORKUTI Dritan MUSTAFA Eleonora OLLI AAB Executive Committee AAB Executive Committee Chairman of Albanian in particular. Member & CEO Member & CEO of Tirana Institute of Authorized of Credins Bank Bank Chartered Auditors (IEKA) ALBANIAN ASSOCIATION OF BANKS Street "Ibrahim Rugova" Andi BALLTA Ervin METE Spiro BRUMBULLI AAB Executive Committee General Executive Director Secretary General, SKY TOWER, 9/3, Tirana Member & CEO of Albanian Financial Albanian Association of Tel: ‘+355 4 2280371/2 of American Bank Supervision Authority Banks Fax: +355 4 2280 359 of Investments www.aab.al July 2020 Bankieri 3 www.aab.al 4 Bankieri July 2020 www.aab.al EDITORIAL From lockdown to open up: the road to confidence The government, regulatory authorities, academia and business leaders must shore up confidence to the future, although it will be a hilly bumpy road; they must hurry up to adapt and remodel the economy by way of employing new business models and structure, improving productivity, developing new products, attracting talents, using technology massively, etc. unbelievable similar path towards This is the most remarkable economic abyss. After many weeks challenge, out of the whole set of struggle the economy began to of challenges, for policymakers, open up, slowly but steadily, and regulators and financial unsurprisingly we all witnessed institutions, banks included, as the what we had in mind: the economy last financial and economic crises is suffering quite a lot, and the road are not a relevant lesson for the to normality, would be long and future. painful, as the economic cost of the However, for the future to Covid-19 crisis is unprecedented, come, the banking sector and both globally and domestically. The the financial industry shall try to Albanian Government and Bank of adapt to such set of challenges, Albania took very quick and serious from the increase of government steps to halt the economic and debt, recession, lower income Prof. Asoc. Dr. Elvin MEKA1 financial collapse, by taking proper and spending, lack of business Editor-in-Chief measures, like: two financial and households’ confidence to packages and sovereign guarantee take risk and invest, along with schemes, loan repayment holiday bolstering private expenditures, COVID-19 pandemic outbreak for bank clients, liquidity supporting and the unavoidably reshape of the caught the whole world almost off- measures, accommodative work and the workplace. One thing guard, although upsetting news monetary policy, relaxing risk is clear: Nothing will ever be the form China were on display, since management measures for the same again! So, the government, January. Surely, the health safety banking system, etc. regulatory authorities, academia was of paramount importance and Fortunately, the banking system and business leaders must shore up in this way, nearly all Europe, and in Albania, as everywhere, faced confidence to the future, although it naturally Albania, went into a rapid the pandemic well-prepared, in will be a hilly bumpy road; they must lockdown. Initially, the social and terms of capitalization and liquidity, hurry up to adapt and remodel the economic lockdown put reins on so they weathered successfully economy, by way of employing new the coronavirus mass spreading, the first shockwave of pandemic, business models and structure, thus mitigating the pressure on the supported by proper measures improving productivity, developing health system, but soon the health from government and BoA, too. So new products, attracting talents, emergency met another more far, the measures have prevented using technology massively, etc. complex emergency: the economic the long-term economic damage Practically, we all need to recall hibernate and the risk of economy’s and debacle and ensured the and implement what US President collapse. So, the health emergency financial system continuity, but Abraham Lincoln once said: “The and crisis, was substituted with the they have not finally cleared the best way to predict your future is economic emergency. path towards economic recovery, as to create it”! The most striking aspect of such the coronavirus crisis has already emergency is that it has evolved as a caused a structural damage to highly virulent economic pandemic, the economy, and furthermore, where all the world economy was the economy and the respective 1Dean of Faculty of Economy, Business & plunged into the crisis as a whole recovery process is currently Development, European University of Tirana, and within weeks, following an moving into uncharted territory. UET. July 2020 Bankieri 5 www.aab.al FRONTLINE Challenges for entrepreneurship and government support, during COVID-19 pandemic Now that we will have to live in a “new normal”, by having coronavirus between us, we have focused all our energies on the process of economic recovery, working with several scenarios, for which deep analyses are underway. were good measures for the health stakeholders, as well as on site battle, they were asphyxiating visits to enterprises allowed to measures for the economy and operate, to better understand business, which were entering their problems, in order to set a very difficult period, which is priorities. It was important, first, expected to continue for a while. to create conditions for businesses The battle remains global, so that provide food products, either be the reaction, too. This was the producers or importers, to be able reason why, we started taking to run their activity, as well as to measures very quickly, while discipline people movements, by not interrupting the supply chain of the population. Now we may already say that, together with entrepreneurs, we succeeded Eduard SHALSI While the banking system is despite terrible difficult Minister of State for Entrepreneurship facing extraordinary challenges, Protection conditions. it should be understood that the The situation was managed traditional banking mechanisms effectively, by taking into account the requirements and instruments it would be hile the pandemic got, and complaints, which were even the developed impossible to successfully presented by representatives W world, completely off overcome the consequences of chambers of commerce and guard, just two battles took place of COVID-19 pandemic and business associations in the simultaneously, thus agreeing country. Depending on the sector that new ways must be found, and acknowledging globally that, where businesses operate, despite hesitations, insecure and extraordinary measures the requirements have been of and hazy attitudes from some must be taken, to cope with the different typologies, the most world leaders, the main and most unprecedented situation. important of which were related important battle to be won was the to tax reliefs (VAT, profit tax, health battle. health and social insurance, etc.), Such difficult and unimaginable subsidies and financial support period put everything in question (for employees, services, or for and changed, within a short time, carefully following the experience rents), facilitating administrative the way of perception for life and of other countries, by calculating, procedures, issues with goods and the world. While all forces became in a not-easy and unprecedented employees’ movements, as well concentrated on the health battle circumstances, what would be the as concerns about international front, the war on coronavirus most effective measures. and intercity transport. The would, unavoidably, begin to affect Another challenging front, ease of communication with the the economy, day bay day. Whereas during this two-month period, latter, thanks to