Candidates for a member of the Central Bank Council (CBCG) must have at least 10 years of work experience in the fields of economics, banking, finance or law.
This is one of the important novelties in the proposed amendments to the CBCG law, which the Government established at the proposal of the Ministry of Finance at the session last week.
"The current law does not prescribe a minimum number of years of work experience for any member of the CBCG Council, but it is prescribed only that the governor and vice-governor must have at least five years of work experience in managerial positions in the specified areas", it was explained in the explanation of the bill in which are numerous newspapers adopted at the suggestion of the International Monetary Fund (IMF).
The current Law on the CBCG defines that upon the accession of Montenegro to the European Union (EU) the supreme monetary institution has five members - the governor and four vice-governors, and with the proposed changes, following the recommendation of the IMF, that solution is deleted so that the Council remains with eight members : the governor, three vice-governors and four members who are not employed by the CBCG.
Due to the current political crisis in the country, the CBCG is another in a series of branches of government that function in an acting state, as several members of the Council have expired, and some positions have not been filled at all. The mandate of Council members lasts for six years.
Governor Radoje Žugić the mandate expired in October last year and a new governor has not been elected to date. Former President of the State Milo Djukanovic proposed to the parliament that Žugić be re-elected to that position, which the deputies have not commented on since October last year, while Đukanović did not sign the amendments to the law on the CBCG, which, at the proposal of the DF, defined that the governor is elected in a public contest in the parliament , and not to be proposed by the president of the state.
Vice Governor Miodrag Radonjić resigned from that position, which was confirmed in parliament in February of this year. Radonjić was elected vice-governor at the end of 2017, while in March of that year he was elected second vice-governor Nicola Fabrice whose mandate expired in March of this year.
One position in the CBCG Council has been vacant since December 2019, when he left that position Zorica Kalezić elected vice-governor instead Irene Radović. This is a position that was supposed to be filled on the proposal of the Parliamentary Committee for Economy, Finance and Budget.
"CBCG indicated in a letter dated February 11, 2, to the Assembly that the appointment of a member of the Council as vice-governor left vacant the position of one member of the Council who is not employed by the CBCG," the supreme monetary institution told "News" earlier.
"News" did not receive an official answer from the parliament as to why the procedure for filling this vacant position was not initiated.
The Assembly elects four members of the CBCG Council, and on its proposal, they are now in it Milorad Jovovic, Ruždija Tuzović i Nikola Milović who were elected in July 2018.
According to the recommendation of the IMF, it is also proposed that the CBCG Council as its permanent body, in addition to the Audit Committee, has an Advisory Committee that will have a president and at least two members who must have 10 years of work experience in the field of economics, banking, finance or law .
"The Advisory Board makes recommendations to the Council regarding policies and other acts that the Council decides on. In addition, the Advisory Committee submits a quarterly report on its work to the Council", as defined by the proposal for amendments to the law.
According to the recommendation of the IMF, it is proposed to amend Article 16 of the current law, which stipulates that, in case of liquidity needs of credit institutions (banks), the CBCG can grant loans only to solvent banks, with appropriate means of security (which until now was prescribed by the decision ). In addition, paragraph 2 of the proposed article establishes that, in addition to the conditions for granting loans, the CBCG also prescribes the method of granting those loans.
In order to harmonize with the Law on the Rehabilitation of Credit Institutions (Banks), it is proposed to amend Article 28 of the Law, which stipulates that the CBCG, in addition to controlling banks, also carries out their rehabilitation and adopts regulations and other acts regulating the rehabilitation of credit institutions, as well as the amendment it is prescribed that the CBCG may, in order to achieve the rehabilitation goals, take rehabilitation measures towards credit institutions in accordance with the law regulating the rehabilitation of credit institutions.
The council will appoint the administrators and their assistants in the banks
In order to harmonize the Law on the CBCG with the laws on banks and bank rehabilitation, it is proposed to amend Article 31 of the law, which stipulates that, in order to improve the supervision and rehabilitation of credit institutions, the supreme monetary institution cooperates with foreign institutions authorized for the supervision and rehabilitation of banks (as opposed to from the current law by which this cooperation was aimed at foreign institutions authorized only for control) and that the exchange of information within the framework of this cooperation is not considered a secret disclosure.
"It is prescribed that the Council appoints an administrator and assistant administrator in banks and decides on other issues related to the work of administrators and assistant administrators in accordance with the law governing the operation of banks, to decide on the introduction of temporary administration in the bank and other issues related to temporary by the administration in accordance with the law regulating the business of banks", it was stated in the explanation of the law.
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