{
  "title": "Bosnia and Herzegovina: Financial Sector Assessment Program Technical Note—Systemic Liquidity Management, Financial Safety Net, Insolvency Framework, and Macroprudential Policy",
  "publication": "IMF Staff Country Reports, August 3, 2015",
  "sourceUrl": "https://www.imf.org/en/publications/cr/issues/2016/12/31/bosnia-and-herzegovina-financial-sector-assessment-program-technical-note-systemic-liquidity-43150",
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  "summary": "This Technical Note discusses key findings and recommendations of the assessment on Systemic Liquidity Management, Financial Safety Net, Insolvency Framework, and Macroprudential Policy on Bosnia and Herzegovina.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- This Technical Note discusses key findings and recommendations of the assessment on Systemic Liquidity Management, Financial Safety Net, Insolvency Framework, and Macroprudential Policy on Bosnia and Herzegovina.\n- It is observed that there are constraints on the ability of both banks and the Central Bank of Bosnia and Herzegovina to manage liquidity.\n- The system lacks a central bank liquidity window, and the secondary market for government securities is small and illiquid.\n- Liquidity regulations should be streamlined and the adoption of the liquidity coverage ratio would strengthen liquidity management.\n- The deposit insurance framework is a relatively well-developed paybox scheme, but further enhancements of the deposit insurance arrangements would be beneficial."
    },
    {
      "heading": "Key findings",
      "content": "- Constraints exist on liquidity management capacity for both banks and the Central Bank of Bosnia and Herzegovina.\n- Absence of a central bank liquidity window limits systemic liquidity support options.\n- The secondary market for government securities is small and illiquid, reducing market-based liquidity management tools.\n- Current liquidity regulations are fragmented and would benefit from streamlining.\n- Adoption of the liquidity coverage ratio is recommended to strengthen liquidity management frameworks.\n- Deposit insurance operates as a paybox scheme and is relatively well-developed, though improvements are advisable."
    },
    {
      "heading": "Policy recommendations",
      "content": "- Establish or enable a central bank liquidity window to improve systemic liquidity management.\n- Deepen and develop the secondary market for government securities to enhance market liquidity tools.\n- Streamline existing liquidity regulations to reduce fragmentation and improve clarity for financial institutions.\n- Adopt the liquidity coverage ratio to align liquidity management with international standards.\n- Enhance deposit insurance arrangements beyond the existing paybox framework to improve depositor protection and financial safety net resilience.\n\n---\n\n Content in this bundle\n\n- cr15216 — Executive Summary\n  - cr15216 — Executive Summary (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - cr15216 — Executive Summary (PDF){rel=\"external\" type=\"application/pdf\"}"
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    "Published: August 3, 2015",
    "Series: IMF Staff Country Reports",
    "DOI: https://doi.org/10.5089/9781513580210.002",
    "This Technical Note discusses key findings and recommendations of the assessment on Systemic Liquidity Management, Financial Safety Net, Insolvency Framework, and Macroprudential Policy on Bosnia and Herzegovina.",
    "It is observed that there are constraints on the ability of both banks and the Central Bank of Bosnia and Herzegovina to manage liquidity.",
    "The system lacks a central bank liquidity window, and the secondary market for government securities is small and illiquid.",
    "The deposit insurance framework is a relatively well-developed paybox scheme, but further enhancements of the deposit insurance arrangements would be beneficial.",
    "Constraints exist on liquidity management capacity for both banks and the Central Bank of Bosnia and Herzegovina.",
    "Absence of a central bank liquidity window limits systemic liquidity support options.",
    "The secondary market for government securities is small and illiquid, reducing market-based liquidity management tools.",
    "Current liquidity regulations are fragmented and would benefit from streamlining.",
    "Adoption of the liquidity coverage ratio is recommended to strengthen liquidity management frameworks.",
    "Establish or enable a central bank liquidity window to improve systemic liquidity management.",
    "Deepen and develop the secondary market for government securities to enhance market liquidity tools.",
    "Streamline existing liquidity regulations to reduce fragmentation and improve clarity for financial institutions.",
    "Adopt the liquidity coverage ratio to align liquidity management with international standards.",
    "Enhance deposit insurance arrangements beyond the existing paybox framework to improve depositor protection and financial safety net resilience.",
    "**_cr15216 — Executive Summary**"
  ],
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