As of the end of January, the assets of Montenegro’s banking sector reached €7.83 billion, marking a year-on-year increase of 9.9 percent. Within this asset composition, net loans constituted 66.3 percent, while securities accounted for 18.2 percent and cash along with central bank deposits made up approximately 12 percent.
Deposits represented 76.2 percent of liabilities, and total banking capital rose to €1.04 billion, reflecting an increase of nearly 15 percent compared to the previous year. This predominantly deposit-funded structure mitigates exposure to wholesale refinancing risks and establishes a stable foundation for domestic lending activities.
The primary concern lies in the allocation of resources rather than funding availability. The robust lending to households, property buyers, and the construction sector may support short-term growth but also raises concerns regarding asset concentration in areas heavily reliant on tourism, foreign investments, and coastal property values.
To address these challenges, facilities backed by the European Investment Bank (EIB) through the Development Bank of Montenegro and commercial lenders aim to redirect credit towards sectors such as digitalization, energy efficiency, manufacturing, and smaller renewable energy projects. Additionally, a separate €187 million regional innovation and green-transformation facility is set to provide loans, grants, and technical assistance to small and medium-sized enterprises (SMEs) across the Western Balkans via partner financial institutions.
Montenegrin businesses are eligible for this support; however, their ability to effectively utilize these funds hinges on their preparation of audited financial statements, technical investment plans, environmental documentation, and reliable cash-flow projections. Access to concessional finance alone does not guarantee the emergence of viable corporate borrowers.
