April 1, 2019 / 12:37 PM / 23 days ago

Bosnia's central bank doubles charge on banks' surplus reserves

SARAJEVO, April 1 (Reuters) - Bosnia’s central bank has doubled the negative interest rate on commercial banks’ excess reserves to minus 40 basis points from -20 bps, in line with the rate charged for deposits by the European Central Bank, it said on Monday.

The rate is charged on deposits that exceed the reserves banks are obliged to hold. The 10 percent rate charged on obligatory reserves remains unchanged, the central bank said.

The bank introduced a negative interest rate on commercial banks’ excess reserves in 2016 to boost lending by Bosnia’s mainly foreign-owned banks, which had cut lending saying there was a shortage of good projects to support with loans.

The bank said the decision will come into effect on May 1. (Reporting by Daria Sito-Sucic; Editing by Catherine Evans)

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