Changes made to law “On Banks in the Republic of Albania”

Official Bulletin no. 263, dated 11 January 2017

The Parliament of Albania, on 22,12,2016, approved several changes made to law no. 131/2016, “On Banks in the Republic of Albania”, as amended.

Firstly, the law repeals points 36 and 37 of article 4 which handle the matter of custody and point 49 of article 4, as well as article 81/1, 81/2, 81/3 and 81/4 which handle the matter of establishment and operation of the bridge bank, the operating method and closure and/or liquidation of the bridge bank.

The main change made by this act is the one defined in point 1 of article 121, which determines the sequences of obligations regarding the accepted claims which are preferably liquidated, besides the ones obtained with obligatory executive means of liability as an insuring burden or financial collateral, in cases of bank or foreign branch liquidation, as follows:

a) Necessary and reasonable costs, by the liquidator, the Bank of Albania (Extraordinary Intervention Authority) and Deposit Insurance Agency,

b) Creditors of new loans given to the bank or the bank of a foreign branch after the extraordinary intervention and the liquidator nomination,

c) Insured deposits that are uncompensated by the Deposit Insurance Agency or the Deposit Insurance Agency for insured deposits payments,

d) Part of the insured deposits of the individual, commercials and trading societies, which overcomes the maximum level of coverage from the insuring deposits scheme, as well as the deposits which have not profited according to letter ‘c’ of this article,

e) Uninsured liabilities by obtained with obligatory executive means of liability, insuring burden or financial collateral,

f) Subordinated liabilities that include contractual clauses on their definition regarding the settlement of liabilities, as well as other conditions, determined by the Bank of Albania;

g) Instruments of uninsured capitals with obligatory executive means of liability, insuring burden or financial collateral, which are not shares,

h) Liabilities towards shareholders, coming from shares ownership.