Global financial crisis and its impact on the financial system of Kosovo

Ramosaj, Berim (2010): Global financial crisis and its impact on the financial system of Kosovo.

Abstract

The Kosovo’s Financial Sector is one of the newest financial sectors in Eastern Europe whose developments began in early 2000. Kosovo's banking sector consists of 8 privately owned commercial banks, the insurance companies which make up 5% of total financial sector assets by 10 insurance companies with over 70% foreign equity ownership. Pension funds also participate by about 1.5% of the total financial sector assets.

In the long history of global financial crisis, and such have been over 120, the current crisis is regarded as among the most profound (similar to that of year 1929) and comprehensive on the speed and breadth of development. The sources of the crisis lie in the three pillars of the functioning of banking institutions: inadequate management of credit risk and liberalization of excessive lending policies; inadequate capitalization of the banking institutions; and inadequate management of their liquidity.

Kosovo is part of Europe and cannot act as a closed oasis. The concept of a new model of financial sector in Kosovo is thought to create additional mechanisms that will enable advancements in the development of Kosovo’s financial sector with special focus in the field of investment and that mean financial market development namely the securities market.

Legal infrastructure on debt market in Kosovo will create a legal possibility that the central and municipal government have the opportunity to borrow in order to implement their development policies. It is unimaginable implementation of the project without information technology support. This support has to do with that that information technology offers its capacities in supporting of all the activities that include the operation of the securities market and the creation of its electronic data base.

• Item Type: MPRA Paper
• Language: English
• Keywords: Financial market, ffinancial crisis, financial system, financial institutions, financial intermediation
• Subjects: G - Financial Economics > G2 - Financial Institutions and Services > G22 - Insurance ; Insurance Companies ; Actuarial Studies; G - Financial Economics > G2 - Financial Institutions and Services > G23 - Non-bank Financial Institutions ; Financial Instruments ; Institutional Investors; N - Economic History > N2 - Financial Markets and Institutions > N20 - General, International, or Comparative; G - Financial Economics > G2 - Financial Institutions and Services > G28 - Government Policy and Regulation; G - Financial Economics > G2 - Financial Institutions and Services > G24 - Investment Banking ; Venture Capital ; Brokerage ; Ratings and Ratings Agencies; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages; G - Financial Economics > G2 - Financial Institutions and Services > G20 - General

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